Assume that the central bank purchases government securities in the open market. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the GDP Price Index and net nonreserve-related international borrowing/lending in the context of the Three-Sector-Model?
a. The GDP Price Index falls, and net nonreserve-related international borrowing/lending becomes more negative (or less positive).
b. The GDP Price Index and net nonreserve-related international borrowing/lending remain the same.
c. The GDP Price Index falls, and net nonreserve-related international borrowing/lending becomes more positive (or less negative).
d. The GDP Price Index rises, and net nonreserve-related international borrowing/lending becomes more negative (or less positive).
e. The GDP Price Index rises, and net nonreserve-related international borrowing/lending becomes more positive (or less negative).
.D
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The unemployment rate measures the: a. number of people in the labor force divided by the adult population
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a. that can be used in place of another good or service. b. used with another good or service. c. that cannot be replaced with another good or service. d. that can have no demand for itself.