If a nation's real interest rate fell relative to foreign nations, it would cause net exports to:
a. Fall.
b. Rise.
c. Remain unchanged.
d. It could increase or decrease net exports, depending on the elasticity of demand for foreign exchange.
.B
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Suppose the government taxes 30 percent of the first $70,000 and 50 percent of all income above $70,000 . For a person earning $100,000 . the marginal tax rate is
a. 30 percent, and the average tax rate is 50 percent. b. 30 percent, and the average tax rate is 36 percent. c. 50 percent, and the average tax rate is 40 percent. d. 50 percent, and the average tax rate is 36 percent.
Market failures
A. result in quantities and prices that are socially desirable. B. weaken the argument for government intervention in the economy. C. strengthen economic efficiency by forcing unprofitable firms to close. D. prevent the price system from attaining economic efficiency.
If a firm pays its workers $10 per hour, the marginal product of labor is 5 units per hour, and the price of the firm's product is $15 per unit, what is the price elasticity of demand facing the firm?
A) -1.15 B) -2.15 C) -1.0 D) -3.56
"Crowding-out" occurs in the IS-LM model as rising government spending requires a ________ in the interest rate in order to ________ the demand for money at the new equilibrium, thus ________ planned private investment
A) rise, keep constant, lowering B) rise, raise, lowering C) rise, lower, raising D) fall, keep constant, raising E) fall, raise, lowering