Contractionary Policies Help Correct a Balance of Payments Deficit by

question 105

Multiple Choice

Contractionary policies help correct a balance of payments deficit by

• A)lowering domestic incomes but raising demand for imports
• B)raising domestic incomes but lowering demand for imports
• C)raising both domestic incomes and demand for imports
• D)lowering both domestic incomes and demand for imports
• E)lowering interest rates and increasing aggregate spending

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Definitions:

Opportunity To Retreat

The option or possibility for an individual or group to withdraw from an uncomfortable, challenging, or dangerous situation safely.

Fait Accompli

A French term meaning "accomplished fact"; something that has already been done and cannot be changed.

Distributive Bargaining

A method of negotiation where the goal is to distribute a limited amount of resources in a manner that maximizes one's own benefit.

Limited Resource

Any asset which is scarce or finite, creating constraints in its allocation and necessitating efficient management.