Question: How would I go about solving this problem? There are multiple answers and I cant figure out the right ones. I keep missing answers. When
How would I go about solving this problem? There are multiple answers and I cant figure out the right ones. I keep missing answers.

When the US "talks tough" about trade policy, China's leaders routinely hint that they might decide to stop buying US government securities. According to the Spending Allocation Model, which of the following would happen in China, if China followed through with this threat? C] Equilibrium R* would rise. C] The equilibrium Investment share of potential GDP would rise. C] The S/Y* curve would shift to the right. C] The l/Y* + X/Y* curve would shift to the left. C] Equilibrium R* would fall. C] The S/Y* curve would shift to the left. C] The |/Y* + X/Y* curve would shift to the right. C] The equilibrium Investment share of potential GDP would fall
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
