Q. According to the Keynesians, (Solved)
1. An easy-fiscal tight-monetary policy reduces the trade deficit, such as what occurred during the 1980s
2. An easy-fiscal tight-monetary policy mix affects the composition of output by encouraging imports of foreign goods and discouraging U.S. exports, as was experienced during the 1980s
3. There was not a link between the rising government budgetary deficit and the rising trade deficit during the mid-1980s
4. Budget deficits and trade deficits should not be a source of concern
- b. An easy-fiscal tight-monetary policy mix affects the composition of output by encouraging imports of foreign goods and discouraging U.S. exports, as was experienced during the 1980s