If a country repeals an investment tax credit that, subsidizes domestic investment,
a. net capital outflow and the real exchange rate rise.
b. net capital outflow rises and the real exchange rate falls.
c. net capital outflow falls and the real exchange rate rises.
d. net capital outflow and the real exchange rate fall.
b
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What is meant by the statement that "optimal decisions are made at the margin"?
What will be an ideal response?
The federal budget is: a. submitted by Congress to the President and contains proposals for tax increases
b. submitted by Congress to the President and contains proposals for government expenditures. c. always in balance, with receipts equal to expenditures. d. equal to government purchases plus cash and in-kind transfer payments. e. usually planned for the calendar year, which starts from January.
If real GDP and the GDP deflator both rise, then it must be that nominal GDP rose
a. True b. False Indicate whether the statement is true or false
Suppose when the price of novels goes from $15 to $20 per book, production increases from 760 million books to 840 million books per year. Using the mid-point method, the price elasticity of supply is:
A. 37 percent B. 0.77 C. 28.5 percent D. 0.35