A favorable balance of trade occurs when:
a. goods exports are greater than goods imports.
b. goods imports are greater than goods exports.
c. international trade is an increasing share of total output.
d. the balance on capital account equals the balance on current account.
e. unilateral transfers are positive.
a
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If investment demand increases, the equilibrium real interest rate ________ and the equilibrium quantity of investment ________
A) rises; decreases B) falls; decreases C) falls; increases D) rises; increases E) does not change; does not change
Refer to the graph below. Assume the consumer has an income of $100, the price of X is $2 and the price of Y is $1. According to the graph below, the total effect of a decrease in the price of X from $2 to $1 is equal to: 
A. 25 B. 20 C. 30 D. 5
The laissez faire view of government involvement in the economy is most consistent with the
A. Supply-side theory. B. Keynesian theory. C. Monetary theory. D. Classical theory.
Business cycle fluctuations typically arise because
A. The actual supply of goods and services ends up being more or less than what consumers were expecting B. The actual demand for goods and services ends up being more or less than the expected supply of goods and services C. The actual demand for goods and services ends up being more or less than what firms were expecting D. Prices tend to be flexible in the short run