Which of the following is a true statement describing expansionary fiscal policy’s impact in open and closed economies? Select one: a. Expansionary fiscal policy crowds out only investment spending and purchases of consumer durables in an open economy. b. Expansionary fiscal policy crowds out investment spending, purchases of consumer durables and net exports in an open economy. c. Expansionary fiscal policy crowds out investment spending, purchases of consumer durables and net exports in a closed economy. d. Expansionary fiscal policy does not crowd out investment spending and purchases of consumer durables in an open economy.

Which of the following is a true statement describing expansionary fiscal policy’s impact in open and closed economies? Select one: a. Expansionary fiscal policy crowds out only investment spending and purchases of consumer durables in an open economy. b. Expansionary fiscal policy crowds out investment spending, purchases of consumer durables and net exports in an open economy. c. Expansionary fiscal policy crowds out investment spending, purchases of consumer durables and net exports in a closed economy. d. Expansionary fiscal policy does not crowd out investment spending and purchases of consumer durables in an open economy.

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter4: The Aggregate Economy

Section: Chapter Questions

Problem 5E

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