Assuming no change in the effective tax rate on capital, an increase in the government budget deficit will reduce the current account deficit if and only if the increase in the budget deficit
A. increases desired national investment.
B. increases desired national saving.
C. reduces desired national saving.
D. reduces desired national investment.
Answer: C
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Refer to Table 4-12. The equations above describe the demand and supply for Bubba's Fried Jellybeans. The equilibrium price and quantity for Bubba's Fried Jellybeans are $40 and 5 thousand units. What is the value of consumer surplus?
A) $5 thousand B) $12.5 thousand C) $25 thousand D) $37.5 thousand
In the second half of the 1990s a rapidly growing movement focused on the harm caused by international trade to
A) land owners in poor countries. B) capital owners in rich industrialized countries. C) land owners in rich industrialized countries. D) production workers in both rich and poor countries. E) terms of trade in developing countries.
The negative impact of government debt on the economy is mitigated by ________
A) the impact of the debt on national saving B) government spending on schools and highways C) the interest rate effects of government budget deficits D) the phenomenon of crowding-out
The price elasticity of supply measures how
A. responsive the quantity supplied of Y is to changes in the price of X. B. responsive quantity supplied is to a change in incomes. C. easily labor and capital can be substituted for one another in the production process. D. responsive the quantity supplied of X is to changes in the price of X.