If a Government Increases Its Budget Deficit, Which of the Following

question 170

Multiple Choice

If a government increases its budget deficit, which of the following best predicts the effects?

• A)The real exchange rate appreciates, and the trade balance moves toward surplus.
• B)The real exchange rate appreciates, and the trade balance moves toward deficit.
• C)The real exchange rate depreciates, and the trade balance moves toward surplus.
• D)The real exchange rate depreciates, and the trade balance moves toward deficit.

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Definitions:

Imprisonment

The act of confining someone in a prison as a legal punishment for committing a crime.

Felony

A serious criminal offense that is usually punishable by imprisonment for more than one year or by death.

Capital Offense

A crime that is punishable by death under the legal system.

Model Penal Code

A text designed to stimulate and assist state governments in updating and standardizing their penal laws.