Business, 11.04.2020 01:13, buchaell000

Suppose the U. S. government cuts back on government spending and increases taxes in an effort to reduce the budget deficit. What would be the effect of these changes on the U. S. balance of payments?

a. There would be no change because the balance of payments always equals zero.
b. There would be an increase in the current account and a decrease in the capital account.
c. There would be a decrease in the current account and a decrease in the capital account
d. There would be a decrease in the current account and an increase in the capital account
e. There would be an increase in the current account and an increase in the capital account

Answers: 2

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Suppose the U. S. government cuts back on government spending and increases taxes in an effort to re...