When the United States imposes an import quota on a good, the amount of the ________ in U.S. consumer surplus is ________ the amount of the ________ in U.S. producer surplus
A) increase; smaller than; increase
B) decrease; larger than; decrease
C) decrease; larger than; increase
D) decrease; equal to; increase
C
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If an economist claims there are substitutes for clean air, he is really saying
A) clean air is free air. B) there are costs to cleaning the air. C) nobody is truly harmed by unclean, polluted air. D) dirty air is better than clean air. E) economists don't care for clean air.
A current account deficit
A) will not pose a problem, especially if it is accompanied by an expansionary fiscal policy. B) may pose no problem if the borrowed funds are channeled into productive domestic investment projects that pay for themselves with the revenue they generate in the future. C) may still pose a problem, even if the borrowed funds are channeled into productive domestic investment projects. D) There is no relation between current account surplus and between savings and investment. E) will pose a problem because the country is borrowing funds from the rest of the world that it won't be able to pay back later.
The international reserves of the Federal Reserve System include its holdings of ________
A) Treasury securities B) discount loans to commercial banks C) foreign currency denominated assets D) U.S. dollars, British pounds and Euros
According to the Taylor rule, if actual output is greater than the natural rate of output, then the Fed should
a. decrease inflation. b. increase interest rates. c. conduct open market sales. d. decrease interest rates. e. Both a and b