If the financial and capital account has a deficit, the:
A. balance of payments must have a surplus.
B. balance of payments must have a deficit.
C. balance on the current account must have a deficit.
D. balance on the current account must have a surplus.
Answer: D
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If the money wage rate and the price level both rise by the same proportion, then in the figure above the potential GDP line ________, and the aggregate supply curve ________
A) shifts rightward; does not shift B) does not shift; shifts rightward C) shifts rightward; shifts rightward D) shifts rightward; shifts leftward E) does not shift; shifts leftward
Where the planned expenditure and the 45-degree lines intersect, the economy is ________ equilibrium, with unplanned inventory investment equal to ________
A) in, zero B) out of, zero C) in, planned inventory investment D) in, autonomous planned expenditure E) out of, autonomous planned expenditure
The primary benefit of a monetary system of exchange compared to a barter system is the increased
a. ability to record transactions. b. time necessary to find trading partners. c. time devoted to shopping. d. efficiency in arranging transactions.
Which of the following is a principle concerning how people interact?
a. Markets are usually a good way to organize economic activity. b. Rational people think at the margin. c. People respond to incentives. d. All of the above are correct.