If a country raises its budget deficit, then net capital outflow
a. rises, so the supply of its currency shifts right in the market for foreign-currency exchange.
b. rises, so the demand for its currency shifts right in the market for foreign-currency exchange.
c. falls, so the supply of its currency shifts left in the market for foreign-currency exchange.
d. falls, so the demand for its currency shifts right in the market for foreign-currency exchange.
c
You might also like to view...
________ is the narrowest monetary aggregate that the Fed reports
A) M0 B) M1 C) M2 D) M3
An increase in the real interest rate outside of the United States will ________ the demand for the dollar and ________ the demand for foreign financial assets
A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease
To assure a well-defined solution to the consumers' intertemporal choice problems, we must assume that consumers' preferences exhibit the properties that
A) consumers are all identical and that more is always preferred to less. B) more is preferred to less and that consumers prefer diversity. C) consumers like diversity and that more is sometimes preferred to less. D) more is sometimes preferred to less and that first-period consumption and second-period consumption are both normal goods.
Which of the following would be the most likely outcome if all perfectly competitive firms in a product market join together to form a monopoly?
A) Both the rate of output and the quantity of labor input employed will decrease. B) Both the rate of output and the quantity of labor input employed will increase. C) The rate of output in the market will increase but the quantity of labor input will decrease. D) The rate of output in the market will decrease but the quantity of labor input will increase.