If foreign residents buy U.S. Treasury securities to finance the budget deficit, then which of the following will likely occur?
A. a decrease in the trade deficit
B. a reduction in the public debt
C. there will be a trade balance
D. an increase in the trade deficit
Answer: D
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A government budget deficit occurs during a budget year when
A) tax revenues > government spending. B) tax revenues < government spending. C) tax revenues = government spending. D) tax revenues + government spending = personal consumption.
Which of the following statements is true?
A) There always exists some amount of unemployment in an economy. B) The unemployment in an economy normally increases at times of expansion and decreases at times of contraction. C) In almost every economy, each job opening is instantly filled by a qualified worker. D) The unemployment rate in an economy is constant over the long run.
In the figure above, if the market is unregulated, at the equilibrium output the marginal external cost is
A) zero. B) $250 per unit. C) $150 per unit. D) $100 per unit.
Nonactivists of the policies believe that
A) wages and prices are very flexible. B) the self-correcting mechanism is very rapid. C) government action is unnecessary. D) all of the above.