Suppose the current account of a country is in balance and the official settlements account equals 0. A new transaction occurs so that the current account is now in surplus, but the official settlements account does not change
From this we know that A) the balance of trade is now in surplus.
B) the government is running a budget deficit.
C) the capital and financial account is now in deficit.
D) the government must make official reserve transactions.
C
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An increase in fixed cost will, in the long run, alter the industry output of
a. both a monopolist and a competitive industry. b. only a monopolist. c. only a competitive industry. d. neither a monopolist nor a competitive industry.
Consider a Stackelberg duopoly with the following inverse demand function: P = 100 ? 2Q1 ? 2Q2. The firms' marginal costs are identical and are given by MCi = 2. Based on this information, the Stackelberg leader's marginal revenue function is:
A. MR(QL) = 50 ? 2QL + c1/2. B. MR(QL) = 50 ? 2QL + c2/2. C. MR(QF) = 100 ? QF + c2/2. D. MR(QF) = 100 ? 2QF + c1/2.
The manner in which a nation's economy reacts when the measured factors are changed affects almost every individual.
Answer the following statement true (T) or false (F)
Under the flexible exchange rate system, when a country tries to stimulate economic growth and improve its employment rates, it is likely to cause:
a. the domestic inflation rate to rise and the domestic currency to depreciate. b. the domestic inflation rate to rise and the domestic currency to appreciate. c. the domestic inflation rate and the value of the domestic currency to remain constant. d. the domestic inflation rate to fall and the domestic currency to appreciate. e. the domestic inflation rate to fall and the domestic currency to depreciate.