When the external balance relationship between government spending and money stock is positive, then the
A) internal balance between them must be negative.
B) internal balance between them might be negative or positive.
C) internal balance between them must also be positive.
D) internal balance between them would not exist.
A
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A large country imposes capital controls that prohibit foreign borrowing and lending by domestic residents. The country is currently running a financial account deficit. The imposition of the capital controls will cause
A) net exports to increase. B) real domestic interest rates to rise. C) real world interest rates to fall. D) desired national saving to fall.
The higher the interest rate, the greater the preference for liquidity
a. True b. False Indicate whether the statement is true or false
According to Keynes, investment was determined
A. equally by the interest rate and the expected profit rate. B. mainly by the interest rate. C. mainly by the expected profit rate.
A decrease in the productivity of a factor of production will
A. cause a firm to move down the marginal revenue product curve. B. cause a firm to move up the marginal revenue product curve. C. shift its marginal revenue product curve to the right. D. shift its marginal revenue product curve to the left.