The simple leverage ratio is defined as:
a. Depreciation of an asset / Value of an asset
b. Current assets / current liabilities.
c. Equity of an asset / Value of an asset
d. Value of an asset / Equity of an asset.
e. Equity of an asset / Original cost of an asset.
D
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If a country's nominal interest rate is zero, then
A) the country's economy is in a liquidity trap. B) exchange rates with other countries are likely to decline. C) exchange rates with other countries are likely to increase. D) monetary policy is likely to be very effective in stimulating the economy. E) the country's economy has achieved monetary equilibrium.
Capital flight raises a country's real exchange rate
a. True b. False Indicate whether the statement is true or false
Suppose that there is an increase in the costs of production that shifts the short-run aggregate supply curve left. If there is no policy response, then eventually
a. because unemployment is low, wages will be bid up and short-run aggregate supply will shift right. b. because unemployment is low, wages will be bid down and short-run aggregate supply will shift right. c. because unemployment is high, wages will be bid up and short-run aggregate supply will shift right. d. because unemployment is high, wages will be bid down and short-run aggregate supply will shift right.
If tax revenues equal 20 percent of total output and government expenditures equal 25 percent of total output, then there is a:
A. trade surplus. B. trade deficit. C. government budget deficit. D. government budget surplus.