An increase in government spending will have a greater impact on net exports when
A) the marginal propensity to save is smaller.
B) the economy is closed.
C) the sensitivity of investment to income is smaller.
D) all of the above
E) none of the above
A
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In the foreign exchange market, if the demand for dollars permanently decreases, the Fed can maintain the exchange rate at its old equilibrium level indefinitely by buying dollars
Indicate whether the statement is true or false
Will the use of the euro help increase economic growth in countries in the European Union? Will it help individual countries using the euro in times of recession? Explain
What will be an ideal response?
Which of the following would be included in this year's gross domestic product (GDP)?
a. One hundred shares of IBM stock that Tony sold this May b. A used car that Tracey sold to Justin c. George's purchase of a fishing rod and reel at a garage sale d. Sharon giving Dennis $20 as a reward for finding her ring e. A bucket of Kentucky Fried Chicken that Kate bought this July
In computing the consumer price index, a base year is chosen. Which of the following statements about the base year is correct?
a. The base year is always the first year among the years for which computations are being made. b. It is necessary to designate a base year only in the simplest case of two goods; in more realistic cases, it is not necessary to designate a base year. c. The value of the consumer price index is always 100 in the base year. d. The base year is always the year in which the cost of the basket was highest among the years for which computations are being made.