An open economy has GDP of $1,200 billion, consumption expenditures of $900 billion government expenditures of $400 billion, domestic investment of $100 billion, and net exports of -$200 billion. What is its demand for loanable funds?
a. -$200 billion
b. -$100 billion
c. $100 billion
d. $200 billion
b
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If a production process generates pollution, then a competitive market will
A) produce more of the good than is socially optimal. B) produce less of the good than is socially optimal. C) produce the socially optimal quantity of that good. D) produce zero output.
The higher the expected rate of inflation,
A) the lower is the nominal rate of interest. B) the higher is the real rate of interest. C) the higher is the nominal rate of interest. D) the higher the real and nominal rates of interest.
Which of the following is not included in the current account?
A. exports of goods B. imports of goods C. U.S. capital inflow and outflow D. unilateral transfers
Refer to the information provided in Table 24.4 below to answer the question(s) that follow.
Table 24.4
Refer to Table 24.4 At the equilibrium level of income, leakages equal ________ billion.
A. $0 B. $100 C. $200 D. $400