Gross fiscal expenditure in a country increased by $100,000 during a certain year. If the marginal propensity to consume is 0.8, then real GDP in this country has increased by:
a. $400,000.
b. $800,000.
c. $200,000.
d. $500,000.
d
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A theory can best be defined as
A. an untested assertion of untested fact. B. a set of assumptions that simplify the real world. C. the opinion of a reliable person who studies a subject or discipline. D. a deliberate simplification of factual relationships that attempts to explain how those relationships work. E. the accumulation of knowledge that has been verified by the scientific community.
Which of the following is a credit in the U.S. current account? a. A U.S. consumer buys a TV made in Malaysia
b. Singapore Airlines buys a jumbo jet made in the United States. c. British investors purchase U.S. government bonds. d. An American citizen flies to Lithuania on the Lithuanian Airlines.
The balanced budget multiplier has a range from zero to 1
Indicate whether the statement is true or false
Strategic currency stabilization:
A. involves frequent exchange rate intervention. B. is successful only if the government does not attempt to affect market expectations. C. can be successful only if governments possess large amounts of official reserves. D. involves carefully-timed exchange rate intervention.