Which of the following is an example of U.S. foreign portfolio investment?
a. Disney builds a new amusement park near Barcelona, Spain.
b. A U.S. citizen buys bonds issued by the British government.
c. A Dutch hotel chain opens a new hotel in the United States.
d. A citizen of Singapore buys a bond issued by a U.S. corporation.
b
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Using fiscal policy to stabilize the economy is difficult because
A. there are time lags involved in the use of fiscal policy. B. the effects of policy changes are known with certainty. C. the size of the government debt doesn't matter. D. potential income is known.
To determine how much of a good to produce to achieve allocative efficiency, we
A) construct a production possibilities frontier and choose the midpoint. B) construct a production possibilities frontier and choose any point on it. C) must produce on the PPF and at the point where the marginal benefit and marginal cost of the good are equal. D) must produce on the PPF and at the point where the marginal benefit exceeds by any amount the marginal cost of the good. E) must produce on the PPF and at the point where the marginal benefit exceeds by as much as possible the marginal cost of the good.
The Fed's lender-of-last-resort function
A) has proven to be ineffective. B) cannot prevent runs by large depositors. C) is no longer necessary due to FDIC insurance. D) creates a moral hazard problem.
In 1886, the price of a 6.5-ounce glass bottle of Coca Cola was priced at 5 cents. In the case of this size bottle of Coca Cola, the price could be considered
A) as remaining sticky in the short run but flexible in the long run. B) as remaining sticky in both the short run and the long run. C) as being flexible in the short run, but returning to price stickiness in the long run. D) as being flexible in both the short run and the long run.