Which one of the following would be recorded as a credit in the U.S. balance of payments accounts?
a. the purchase of an European-made car by an American
b. the purchase of insurance from Lloyd's of London by an American business firm
c. the purchase of an American-made computer by an European business
d. the purchase of Japanese bonds by an American investor
C
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All else held constant, if farmers receive a subsidy for their corn, then this would cause a
A. movement up along the current supply curve of corn. B. movement down along the current supply curve of corn. C. rightward shift in the current supply of corn. D. leftward shift in the current supply of corn.
Under "trickle down", additional economic activity will benefit the poor
Indicate whether the statement is true or false
A profit maximizing firm will hire additional workers until
A) the additional cost associated with hiring the last worker equals the average wage rate of the workers. B) the additional cost associated with hiring the last worker equals the additional revenue generated by that worker. C) the extra revenue generated by the last worker hired equals zero. D) the extra cost associated with hiring the last worker equals the price of the good produced.
Suppose current government spending decreases and that individuals expect future government spending to decrease. Given this information, in which of the following cases will output in the current period be more likely to decrease?
A) Individuals consider only the short run effects of changes in future macro variables when forming expectations of future output and future interest rates. B) Individuals consider only the medium run effects of changes in future macro variables when forming expectations of future output and future interest rates. C) Individuals consider only the long run effects of changes in future macro variables when forming expectations of future output and future interest rates. D) The output effects will be the same in B and C.