Which of the following would call for an inflow of payments to the United States?
a. American imports of German steel
b. American firms selling insurance to British shipping companies
c. gold flowing out of the United States
d. American unilateral transfers to less-developed countries
Ans: b. American firms selling insurance to British shipping companies
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The equilibrium quantity of money in circulation is determined by:
A. the interaction of an upward-sloping money supply curve and a downward-sloping money demand curve. B. the Federal Reserve. C. the decentralized interactions between households and businesses. D. the nominal interest rate, real income, and the price level.
Pat Robertson, a TV evangelist and former Republican Party candidate for president, once said that “debt is an affront to God,” so good Christians should not spend beyond their incomes. Indeed, Robertson wants Christians to save more. If more Americans, Christians as well as others, took his message seriously, how would we represent the result using a Keynesian macroeconomic model?
A. A downward movement along the consumption function B. An upward movement along the consumption function C. A downward shift of the consumption function D. An upward shift of the consumption function
The transactions demand for money
A. varies directly with nominal Gross Domestic Product (GDP). B. varies inversely with nominal Gross Domestic Product (GDP). C. has no relationship with nominal Gross Domestic Product (GDP). D. sometimes directly and sometimes inversely with nominal Gross Domestic Product (GDP).
A steelmaking plant pollutes the air and water so __________
A. the marginal social cost of producing steel exceeds the marginal private cost by the amount of the marginal external cost B. the marginal social cost of producing steel is less than the marginal private cost by the amount of the marginal external cost C. the marginal private cost of producing steel equals the marginal ex-ternal cost plus the marginal social cost D. the marginal private cost of producing steel minus the marginal social cost equals the marginal external cost