The ________ is a theory of the balance of trade that emphasizes how domestic spending on domestic goods changes relative to domestic output
A) absorption approach
B) monetary approach
C) pass-through analysis
D) elasticities approach
A
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Based on the figure below. Starting from long-run equilibrium at point C, a decrease in government spending that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at__ creating _____gap.
A. B; no output B. D; an expansionary C. B; recessionary D. D; a recessionary
Suppose, as a result of various dynamic factors associated with exposure to international competition, Albania's economy grew, and is now represented by the rightmost production possibility frontier in the figure above
If its point of production with trade was point c, would you consider this growth to be export-biased or import biased? If Albania were a large country with respect to the world trade of A and B, how would this growth affect Albania's terms of trade? Its real income?
As a percentage of total federal revenue, excise taxes have _____
a. risen slightly since 1960 b. remained constant since 1960 c. risen considerably since 1960 d. fallen since 1960
If two goods are complements, their cross-price elasticity will be
a. positive. b. negative. c. zero. d. equal to the difference between the income elasticities of demand for the two goods.