Which of the following is not true concerning a currency bailout?
A. It can help avoid a domino effect of depreciating currencies in other economies.
B. It occurs when money is lent to an economy to increase or maintain the value of its currency.
C. The expectation of a bailout can encourage policies that lead to a currency crisis.
D. The International Monetary Fund will bail out any nation with a devaluing currency.
Answer: D
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Indicate whether the statement is true or false
Traffic congestion is an example of a ________
A) positive externality B) negative externality C) pecuniary externality D) free-rider problem
Many state and local governments find themselves faced with increasing retirement expenditures for retired government employees. These increasing expenditures will ________ GDP because they are categorized as ________
A) increase; government purchases B) increase; gross private domestic investment C) decrease; state and local government purchases D) not change; transfer payments.
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a. true b. false