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Fiscal Policy: Net Export Effect

APMACR-ZENJS3

If the U.S. government borrows money to support its fiscal policy, which of the following occurs?

I. Increase in interest rates
II. Increase in net exports
III. Decrease in net exports

A

I only.

B

II only.

C

III only.

D

I and II only.

E

I and III only.