If the Government Increases Its Spending When the Economy Is

question 213

Multiple Choice

If the government increases its spending when the economy is expanding, automatic stabilizers _____ the government spending multiplier.

• A)may or may not affect
• B)will increase
• C)will not affect
• D)will decrease

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Definitions:

International Trade

The exchange of goods and services across international borders, influenced by comparative advantages, exchange rates, and global economic policies.

Netherlands

A country in Northwestern Europe known for its flat landscape, canals, tulip fields, windmills, and cycling routes.

Exports

Products or services manufactured in a particular country and purchased by consumers in a different country, adding to the national income of the exporter.

Imports

Products or services that are transported into a country from abroad with the intent of being sold.