Suppose that the Fed decides to decrease the growth rate of the money supply in the United States. What is most likely to happen to the U.S. trade deficit and to GDP?
a. The trade deficit will fall; GDP will fall.
b. The trade deficit will rise; GDP will rise.
c. The trade deficit will fall; GDP will rise.
d. The trade deficit will rise; GDP will fall.
d
You might also like to view...
According to the total revenue test, a price cut increases total revenue if demand is
A) inelastic. B) perfectly inelastic. C) elastic. D) unit elastic.
The former communist countries of eastern Europe and the Soviet Union
a. have a better track record in environment protection than market economies. b. have a dismal environmental record. c. epitomize the ability of planned economies to protect the environment. d. have no water pollution problems.
Explain what is meant by liquidity preference
What will be an ideal response?
Refer to Scenario 9.7 below to answer the question(s) that follow. SCENARIO 9.7: Julio borrowed $80,000 from his great aunt to open a coffee stand at a local flea market. He agrees to pay his great aunt a 5% yearly return on the money she lent him. His other yearly fixed costs equal $16,000. His variable costs equal $60,000. He sold 50,000 cups of coffee during the year at a price of $3.00 per cup.Refer to Scenario 9.7. Julio's total fixed costs equal
A. $4,000. B. $16,000. C. $20,000. D. $80,000.