An increase in real net exports leads to an increase in real GDP. Further
A) real consumption spending increases while real investment spending decreases.
B) real government spending decreases to offset the increase in real net exports.
C) real consumption spending and real saving increase.
D) real consumption spending increases but real saving does not change.
C
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The demand for movies is unit elastic if
A) a 5 percent decrease in the price leads to an infinite increase in the quantity demanded. B) a 5 percent increase in the price leads to a 5 percent decrease in the quantity demanded. C) any increase in the price leads to a 1 percent decrease in the quantity demanded. D) a 5 percent increase in the price leads to a 5 percent increase in total revenue.
Due to inflation, nominal prices are usually
A) equal to real prices. B) smaller than real prices. C) larger than real prices. D) a constant proportion different from real prices.