In considering the net effect of expansionary fiscal policy on the trade deficit, the
A. income effect offsets the price effect
B. price effect offsets the income effect
C. income and price ...
... effects work in the same direction, so the trade deficit is decreased
D. income and price effects work in the same direction, so the trade deficit is increased
Trade policy ... A fiscal deficit is ... view, the expansionary fiscal policy also decreases net exports, which has a mitigating effect on national output and income. ...
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