If a Government Started with a Deficit and Moved to a Surplus

question 175

Multiple Choice

If a government started with a deficit and moved to a surplus, which of the following best describes the effects of these changes?

• A)Domestic investment and the real exchange rate would rise.
• B)Domestic investment and the real exchange rate would fall.
• C)Domestic investment would rise, and the real exchange rate would fall.
• D)Domestic investment would fall, and the real exchange rate would rise.

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Definitions:

Compulsory Participation

A situation or policy where individuals are required by law or rule to engage in a particular activity, such as voting or military service.

Census

An official count or survey of a population, typically recording various details of individuals, such as age, sex, occupation, and nationality.

Representative Sample

A representative sample is a subset of a population that accurately reflects the members of the entire population, used in statistical analysis to make inferences about the population.

Experimental Method

A research methodology that involves manipulating variables to test hypotheses and observe effects.