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When Analyzing the Impact of Government Consumption and Taxes in an Open

Question 40

Multiple Choice

When analyzing the impact of government consumption and taxes in an open economy, we assume that:


A) the reasons for changing fiscal policy are not important.
B) government deficits are a problem for the domestic and international economy.
C) governments always have a balanced budget.
D) governments often do not coordinate their tax and spending policies with those of other nations.

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