Which of the following is a deficit item in the U.S. current account?
A. A Saudi Arabian prince builds six new homes in California.
B. Toyota builds a new plant in California.
C. Sony buys a new film studio in Florida.
D. Many U.S. residents who previously had not traveled abroad decide to make Mexico a tourist destination.
Answer: D
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If the CPI changes from 125 to 120 between 2015 and 2016, how did prices change between 2015 and 2016?
A) Prices increased by 25%. B) Prices decreased by 5% C) Prices decreased by 4%. D) Prices increased by 5%.
As the housing bubble began to burst in 2006-2008, investors would only buy mortgage-backed securities at high yields to compensate for higher perceived default risk. As a result::
A) banks suffered significant capital losses as the value of their holdings of mortgage-backed securities declined B) funds available for mortgages increased C) bank profits rose as they earned higher interest on mortgages D) the price of mortgage-backed securities tended to rise due to the higher yields
A "bad choice" as defined in choice architecture is a choice that:
A. policymakers want to nudge participants away from. B. is one that the chooser will regret later. C. is considered not optimal by the choice architect. D. policymakers consider not optimal for society, despite individual choosers' benefits.
Exhibit 21-5 International currency markets
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Exhibit 21-5 displays the international currency market for yen in terms of dollars and dollars in terms of yen. The demand curve in graph 15-5(A) is determined by:
A. U.S. citizens attempting to purchase Japanese-made goods. B. Japanese attempting to purchase U.S.-made goods. C. U.S. businesses attempting to sell to the Japanese. D. Japanese businesses attempting to sell to the U.S.