When the government goes from running a balanced budget to running a budget surplus,
a. national saving decreases, the interest rate rises, and the economy's long-run growth rate is likely to decrease.
b. national saving increases, the interest rate falls, and the economy's long-run growth rate is likely to decrease.
c. national saving decreases, the interest rate rises, and the economy's long-run growth rate is likely to increase.
d. national saving increases, the interest rate falls, and the economy's long-run growth rate is likely to increase.
d
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If a Thai citizen borrowers dollars for a few months, hedging should take place if
a. the dollar is expected to fall in value over that time b. the dollar is expected to rise in value over that time c. the dollar is expected to fluctuate considerably over that time d. the dollar is expected to remain stable over that time e. none of the above
Kyle puts a greater proportion of his portfolio into government bonds. Kyle's action
a. increases both risk and the average rate of return. b. decreases both risk and the average rate of return. c. increases risk, but decreases the average rate of return. d. decreases risk, but increases the average rate of return.
In the market for yen, an increase in U.S. real interest rates tends to
A. decrease demand. B. increase equilibrium price. C. increase excess demand. D. cause no change in equilibrium price.
The marginal product of capital for the Cobb-Douglas production function is given by:
A. aKa-1 Lb. B. aKa-1 Lb-1. C. bKa Lb. D. bKa Lb-1.