Assume that the central bank purchases government securities in the open market. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the quantity of real loanable funds per time period and current international transactions in the context of the Three-Sector-Model?
a. The quantity of real loanable funds per time period rises, and current international transactions become more positive (or less negative).
b. The quantity of real loanable funds per time period rises, and current international transactions become more negative (or less positive).
c. The quantity of real loanable funds per time period and current international transactions remain the same.
d. The quantity of real loanable funds per time period rises, and current international transactions remain the same.
e. There is not enough information to determine what happens to these two macroeconomic variables.
.A
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A) gross investment but not net investment. B) net investment but not gross investment. C) the purchase of physical capital by firms. D) people's savings. E) consumption expenditure by households.
The phenomenon of scarcity stems from the fact that
a. most economies' production methods are not very good. b. in most economies, wealthy people consume disproportionate quantities of goods and services. c. governments restrict production of too many goods and services. d. resources are limited.
What are most goods in the economy?
a) public goods b) natural monopolies c) private goods d) common resources
An implication of the long-run aggregate supply curve is that continuous increases in the money supply will result in continuous:
A. increases in price level. B. decreases in output and price level. C. decreases in output. D. increases in output and price level.