Large current account deficits imply large financial account surpluses
Indicate whether the statement is true or false
TRUE
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When the government deliberately alters its level of spending? and/or taxes in order to achieve specific national economic? goals, it is exercising
A) a laissez-faire policy.
B) discretionary fiscal policy.
C) monetary policy.
D) a Ricardian policy.
Would a profit-maximizing firm sell where demand is inelastic?
A. No, this would not follow the rule of MC = MR. B. No, the firm could not profitably raise price. C. Yes, the firm could profitably lower price to attract sales. D. Yes, in this case there are few substitutes for the good.
Suppose that the cross price elasticity of demand between goods A and B equals 1.25. Which of the following is TRUE?
A. Goods A and B are complements because the cross price elasticity is positive. B. Goods A and B are substitutes because the cross price elasticity is greater than one. C. Goods A and B are substitutes because the cross price elasticity is positive. D. Goods A and B are complements because the cross price elasticity is greater than one.
The payroll tax for Social Security in the United States is
A. proportional. B. uniform. C. regressive. D. progressive.