Which of the following is NOT an example of positive supply-side policy?

The U.S. Constitution

a. prohibits tariffs on trade between Arkansas and New York but allows tariffs on trade between Hawaii and Alaska. b. prohibits tariffs on all trade. c. allows tariffs on trade with other countries, but not on trade between the states. d. allows tariffs only on goods purchased from the communist nations.

Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the quantity of real loanable funds per time period and the nominal value of the domestic currency in the context of the Three-Sector-Model?

a. Real GDP rises, and nominal value of the domestic currency rises. b. Real GDP rises, and nominal value of the domestic currency falls. c. Real GDP rises, and nominal value of the domestic currency remains the same. d. Real GDP falls, and nominal value of the domestic currency rises. e. There is not enough information to determine what happens to these two macroeconomic variables.