Suppose U.S. interest rates fall. This reduction in U.S. interest rates will cause which of the following to occur?
A) an outflow of capital from the United States
B) no change in foreign investment in the United States
C) an increase in the value (appreciation) of the U.S. dollar
D) an inflow of capital to the United States
Answer: A
You might also like to view...
In the pre-World War I period, the United Kingdom exported mainly
A) manufactured goods. B) services. C) primary products including agricultural. D) technology intensive products. E) livestock.
Suppose a person's utility for leisure (L) and consumption (Y) can be expressed as U = Y + L0.5. Show what happens to the person's labor supply curve when the income tax is cut from 70 % to 30 %. Denote hours worked as H and wage per hour as w
What will be an ideal response?
Which of the following will reduce the velocity of circulation of the money stock?
a. The inflation rate increases. b. The interest rate falls. c. Credit cards are used more frequently. d. More employees are paid once a week instead of once a month.
Which of the following would most likely cause an adverse long-run aggregate supply shock and stagflation?
a. A long-term oil embargo that reduces oil supply to industrialized countries b. A tax cut that stimulates production incentives for industries c. Technological innovation that substantially enhances the productivity of an economy's resources d. Abundant harvests that increase the food supply