Onerous regulations on businesses that take effect next year (in a closed economy)reduce businesses' expected future marginal product of capital. As a result, the real interest rate ________ and saving ________.
A. falls; declines
B. rises; increases
C. falls; increases
D. rises; declines
Answer: A
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Currently, China and India are growing much faster than the United States and Western Europe. This high rate of growth will eventually and naturally slow down in the future because:
a. China and India will exhaust their natural resources. b. Actually, there is no economic reason for China and India's growth rates to fall in the future. c. Current account surpluses will eventually cause capital flight from these nations which will lower the value of their currency and reduce their growth rates. d. Consumption will increase and crowd out investment spending. e. Diminishing returns will eventually set in.
The fee for overdraft privileges are usually between $______ and $______.
Fill in the blank(s) with the appropriate word(s).
All of the costs associated with making and enforcing contracts are referred to as
A) alternative costs. B) opportunity costs. C) marginal costs. D) transactions costs.
In goods market equilibrium in an open economy,
A. the desired amount of exports must equal the desired amount of imports less the amount lent abroad. B. the desired amount of national saving must equal the desired amount of domestic investment. C. the desired amount of national saving must equal the desired amount of domestic investment plus the current account balance. D. the desired amount of exports must equal the desired amount of imports.