A Japanese bank buys bonds sold by Minnesota Manufacturing. Minnesota Manufacturing then uses these funds to buy machinery from Canada. Which of the following decreases?
a. U.S. net exports but not US net capital outflow
b. U.S. net capital outflow but not U.S. net exports
c. U.S. net exports and U.S. net capital outflow
d. neither U.S. net exports nor U.S. net capital outflow
c
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Starting from long-run equilibrium, a large decrease in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; lower; potential B. expansionary; higher; potential C. recessionary; lower; potential D. recessionary; lower; lower
When all of the available factors of production are being efficiently employed, the
A) economy is producing at a point within its PPF. B) economy is producing at a point on its PPF. C) economy is producing at a point beyond its PPF. D) PPF disappears. E) opportunity cost of changing production is infinite.
How can a nation and its producers determine whether or not it has a comparative advantage in producing a particular good or service?
What will be an ideal response?
Real interest rates at times have been negative. Why would anyone lending money agree to a negative real interest rate?
What will be an ideal response?