When an economy becomes attractive to global investors, sparking a capital inflow, one result is often a decrease in net exports. Why?
What will be an ideal response?
The capital inflow reflects an increase in desired investment in the economy. With no change in desired saving, and total output fixed in the short run, the increase in investment spending must either displace exports or increase spending on imports, causing net exports to fall.
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Price supports are a form of price ceiling for agricultural products that lowers prices for consumers and enhances market efficiency.
Answer the following statement true (T) or false (F)
The poverty rate in the United States is highest for:
A. married couples. B. childless households. C. female headed households. D. single people.
Refer to the data provided in Table 16.4 below to answer the following question(s).Table 16.4 shows the situation facing two firms, both of which are polluting. Assume that each firm emits 5 units of pollution.Table 16.4Firm AFirm AFirm AFirm BFirm BFirm BReduction of Pollution by Firm AMC of reducing pollution for Firm ATC of reducing pollution for Firm AReduction of Pollution by Firm BMC of reducing pollution for Firm BTC of reducing pollution for Firm B1$2$21$16$162 6 82 24 4031220332 724204044011253070548160Refer to Table 16.4. Suppose the government wants to reduce the total amount of pollution from the current level of 10 to 4. To do this, the government caps each firm's emissions at 2 units and issues 2 permits to each firm. If firms are allowed to trade permits and
all possible trades are made, Firm B will reduce its pollution by a total of ________ unit(s). A. 0 B. 1 C. 2 D. 3
Monetary stimulus may be ineffective if
A. People usually respond to lower interest rates by consuming more goods and services. B. The investment demand curve is inelastic. C. Expectations of a boom cause the investment demand curve to shift to the right, offsetting interest rate effects that would stimulate the economy. D. The investment demand curve is horizontal.