When a Fiscal Policy Stimulus Raises Both Real Income and the Interest

question 113

Multiple Choice

When a fiscal policy stimulus raises both real income and the interest,

• A)the dollar appreciates.
• B)the dollar depreciates.
• C)imports decrease and exports increase.
• D)both A and C.

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Definitions:

Borrow

The act of receiving something from someone with the intention of returning it or its equivalent after a period of time.

Monthly Payment

A regularly scheduled payment that is due every month, commonly associated with loans or leases.

Years

Units of time that represent a period of approximately 365 or 366 days, based on the Earth's orbit of the sun.

Annuity

A financial product that pays out a fixed stream of payments to an individual, typically used as part of retirement planning.