Suppose the development of the European Union leads to greater investment in Europe. You'd expect
A. an increase in the world real interest rate.
B. a recession in Europe.
C. a decline in the world real interest rate.
D. a rise in the current account in Europe.
Answer: A
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When the income elasticity of demand for a good is negative, the good is called a luxury good
a. True b. False Indicate whether the statement is true or false
If an increase in the price of one good causes buyers to demand more of another good, then the two goods are:
A. normal goods. B. inferior goods. C. substitutes. D. complements.
Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting upward C. Short-run aggregate supply shifting downward D. Aggregate demand shifting leftward
The process of buying financial assets to stimulate the economy when the central bank target interest rate is near or at zero and the interest rate cannot be lowered further is called:
a. bond-trading. b. quantitative bidding. c. open market purchase. d. quantitative easing. e. open market sale.