A country experiencing an international financial crisis will likely
A. see an increase in portfolio investment.
B. be able to maintain growth and prosperity in its domestic economy, but its export sector will suffer.
C. experience a decrease in its economic growth rate.
D. see an increase in foreign direct investment.
Answer: C
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In the long run, the unemployment rate
A) is equal to the expected unemployment rate. B) is zero. C) can take on any value. D) is equal to the natural unemployment rate. E) must be equal to the expected inflation rate.
According to New Keynesians, why can firms increase output in the short run in response to higher prices?
What will be an ideal response?
A fall in the demand for U.S. exports would result in a rise in the exchange rate when
a. there is no capital mobility and exchange rates are allowed to float. b. there is capital mobility. c. exchange rates are allowed to float. d. the country has a balance of payments surplus. e. both c and d.
A monopolist has no supply curve because
a. as demand changes, each output level can be consistent with more than one profit-maximizing price b. monopolists tend to restrict output c. monopolists have no marginal cost curve d. monopolists can charge any price they want e. as demand changes, the firm's profit-maximizing choice of output may change