Considering only its direct effect on income, expansionary fiscal policy tends to:
A. decrease income and imports, shifting the U.S. trade balance in the direction of a surplus.
B. increase income and imports, shifting the U.S. trade balance in the direction of a surplus.
C. decrease income and imports, shifting the U.S. trade balance in the direction of a deficit.
D. increase income and imports, shifting the U.S. trade balance in the direction of a deficit.
Answer: D
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