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Australia is a small open economy. Assume that the Australian government decides to increase spending and in doing so it increases the size of its
Australia is a small open economy. Assume that the Australian government decides to increase spending and in doing so it increases the size of its budget deficit. This is likely to lead to: a. A rise in the world real interest rate b. A rightward shift in the National Savings curve c. A larger trade deficit. d. A smaller trade deficit. e. None of the other answers are correct
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