If the United States and Canada trade hydro-powered electricity for Hollywood films, what type of trade does this represent?
What will be an ideal response?
Interindustry
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Which of the following shifts the aggregate demand curve leftward?
A) a decrease in government expenditure on goods and services B) an increase in the price level C) a tax cut D) an increase in foreign income E) a decrease in the price level
Moving up (to the left) along a linear demand curve, the price elasticity of demand
A) decreases. B) does not change. C) increases. D) at first increases and then decreases.
The interest parity condition requires that:
A) all countries have the same interest rate. B) there is a unique exchange rate for every output level. C) purchasing power parity hold. D) interest rates are fixed in the short run. E) the money supply is held constant.
In a large open economy ________
A) the effect of shifts in saving and investment on the trade balance are in the same direction as in a closed economy B) the effect of shifts in saving and investment on net capital flows are in the same direction as in a closed economy C) the effect of shifts in saving and investment on the domestic real interest rate and the actual levels of saving and investment are in the same direction as in a closed economy D) all of the above E) none of the above