A department store chain in Japan uses yen to purchase 500,000 U.S. dollars from a U.S. bank. It then uses these dollars to buy DVDs from a U.S. filmmaker. As a result of these transactions: A. By how much and in what direction did U.S. net exports change? B. By how much and in which direction did U.S. net capital outflow change?
A. U.S. net exports rose by $500,000.
B. U.S. net capital outflow rose by $500,000.
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Suppose that the production function for the economy is: Y = AK1/4L3/4. Assume that A = 1,000, the capital stock is $32,000 billion, and the labor force is 120 million (or 0.120 billion) workers., The value of the marginal product of capital is
A) $0.0147. B) $0.0213. C) $0.0597. D) $0.25.
If a good is free, a rational consumer will continue to consume that good, irrespective of its marginal utility
a. True b. False Indicate whether the statement is true or false
Answer the following statement(s) true (T) or false (F)
1. If the mpc is 0.8 and government spending increases by $10 billion, equilibrium Y will increase by $50 billion. 2. Decreasing taxes is an example of expansionary fiscal policy. 3. Most of the U.S. government debt is owed to foreign countries. 4. The HDI is an index of well-being. 5. The deficit is the sum of yearly government debts since 1776.
One of the virtues of rising resource prices is they encourage innovation, especially the discovery of other more abundant resources.
Answer the following statement true (T) or false (F)