All of the following are deficit items in the balance of payments EXCEPT
A) purchases of foreign assets.
B) imports of merchandise.
C) foreign tourist expenditures.
D) purchases of foreign currency.
C
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Explain the CPI bias and how it can distort private contracts and increase government outlays
What will be an ideal response?
The expectations-augmented Phillips curve implies that as expected inflation increases, nominal wages ________ to prevent real wages from ________
A) fall; rising B) fall; falling C) rise; falling D) rise; rising
The monetarists would expect a tax cut to have a strong effect on output only if the spending increase was
a. financed by a sale of bonds. b. financed by a cut in government spending. c. financed by an increase in the money stock. d. accompanied by a reduction in the deficit.
The concept of aggregate supply refers to a
a. fixed number of output. b. list of products demanded. c. schedule of output. d. schedule of production costs.