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9 January, 12:05

Suppose there is a reduction in foreign output (Y*). This reduction in Y * will cause which of the following in the domestic country? A) a reduction in output B) a reduction in consumption C) a reduction in net exports D) all of the above E) none of the above

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  1. 9 January, 14:16
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    The correct answer is D) all of the above

    Explanation:

    Lower foreign output means lower foreign demand. So the direct effect of the decrease in foreign output is a declining in U. S. exports by some amount.

    The economy depends on the output in terms of demands and goods.
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