A quota specifies the maximum amount of a good that is permitted into the country from abroad per unit of time.
Answer the following statement true (T) or false (F)
True
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Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the real GDP and current international transactions in the context of the Three-Sector-Model?
a. Real GDP falls, and current international transactions become more negative (or less positive). b. Real GDP rises, and current international transactions become more negative (or less positive). c. Real GDP and current international transactions remain the same. d. Real GDP rises, and current international transactions remains the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
In the open-economy macroeconomic model, if there is currently a surplus in the foreign exchange market, the quantity of desired net exports will increase as the market moves to equilibrium
a. True b. False Indicate whether the statement is true or false
De Beers accounts for approximately 80% of diamond sales worldwide. The source of its market power is:
A. its exclusive ownership of South African diamond mines. B. its patent on diamond production. C. the engagement customs of couples in Western cultures. D. the perfectly inelastic demand for diamonds.
If the economy is inside the production possibilities curve, then more output can be produced using existing resources.
Answer the following statement true (T) or false (F)