With flexible exchange rates, central banks do not have to finance deficits because BOP equilibrium is restored by changes in exchange rates
Indicate whether the statement is true or false
TRUE
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Which of the following countries are net lenders?
I. Japan II. United States A) I only B) II only C) both I and II D) neither I nor II
Direct costs of a public sector investment project are generally easier to measure than the direct benefits
a. true b. false
Which of the following best describes the vicious cycle of poverty? a. Rich countries eventually decline because its citizens become lazy
b. Poor countries eventually improve through investment in education, infrastructure, and capital accumulation. c. Rich countries stay rich through continued high levels of investment in education, infrastructure, and capital accumulation. d. Poor countries stay poor because they cannot afford to invest in education, infrastructure, and capital accumulation.
A perfectly competitive firm faces a:
A. perfectly elastic demand function. B. demand function with unitary elasticity. C. perfectly inelastic demand function. D. None of the answers is correct.