There Is an Intimate Relationship Between a Country's BCA and How

question 98

Multiple Choice

There is an intimate relationship between a country's BCA and how the country finances its domestic investment and pays for government expenditures. Given this, in order for a country to reduce a BCA deficit, which of the following must occur?

• A)For a given level of S and I, the government budget deficit (T - G) must be reduced.
• B)For a given level of I and (T - G), S must be increased.
• C)For a given level of S and (T - G), I must fall.
• D)All of the above would work to reduce a BCA deficit.

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