U.S. imports involve an:
A. outflow of foreign currency from the United States to foreigners.
B. outflow of dollars from the United States to foreigners.
C. inflow of foreign currency from foreigners to the U.S. economy.
D. inflow of dollars from foreigners to the U.S. economy.
Answer: B
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Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting downward C. Aggregate demand shifting rightward D. Aggregate demand shifting leftward
In the short run, if the stock of capital ________ there will be more depreciation
A) remains stable B) grows C) declines D) grows, declines, or remains stable
Currency appreciation will decrease net exports
Indicate whether the statement is true or false
How do RBC economists face the business cycle fact that inflation is procyclical?
A) They argue that even though inflation doesn't fit their theory, everything else does, and inflation is not important. B) They note that inflation would not be procyclical if monetary policy were conducted properly. C) They argue that inflation is procyclical only because monetary policy shocks are the main cause of business cycles. D) They use alternative statistical methods that suggest that inflation is countercyclical.