Explain why large interest rate differences would be strong evidence of unrealized gains from trade
What will be an ideal response?
The difference between onshore and offshore interest rates on similar assets denominated in the same currency should be small if information about global investment opportunities is transmitted efficiently. Data show that this is the case for the U.S., Germany, Japan and the Netherlands.
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Aggregate expenditure is total:
A. spending on final goods and services. B. value added in the economy. C. revenue from the sale of goods and services. D. income of households, businesses, governments, and foreigners.
Product demand is more elastic the longer the time period under consideration.
Answer the following statement true (T) or false (F)
Suppose that Jason quits a job with Corporation A in order to look for more rewarding employment. Jason would be
A. counted as frictionally unemployed. B. counted as cyclically unemployed. C. included in the economy's "hidden employment." D. counted as still being employed.
An accountant may amortize the expense of a durable good by dividing the total amount spent on the good by the number of years the good is expected to last. An economist may amortize the expense of a durable and never fully account for the total expense
Indicate whether the statement is true or false