As nominal Gross Domestic Product (GDP) decreases, people hold
A. less money since they will make fewer purchases.
B. more money because they will want to increase the amount of savings.
C. about the same amount of money since that has been enough in the past.
D. less money because they will want to collect interest.
Answer: A
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What is the reason behind such an outcome? Explain with an example.
When a U.S. firm sells a good abroad for, say, 100 euros (assume $1.5=1euro), U.S. net exports increase by $150. These $150 in exports can be accounted for as $150 increase in capital outflow because ________
A) private consumption in the foreign country increases by $150 B) if the U.S. firm uses the 100 euros to buy a share of stock in a foreign firm, the firm is supplying U.S. capital to that foreign firm C) if the U.S. firm uses the proceeds to buy a U.S. bond, capital investment in the foreign country has increased D) all of the above E) none of the above
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If a university begins a policy of permanently expelling any student caught cheating in any way, you would expect that: a. no students would cheat
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