Suppose the balance on the current account is +$100 billion and the balance on the capital account is -$1 billion. The balance on the financial account is:
A. +$101 billion.
B. -$100 billion.
C. -$99 billion.
D. -$101 billion.
C. -$99 billion.
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A commercial bank has no excess reserves until a depositor places $5,000 in cash at the bank. The commercial bank then lends $4,000 to a borrower. As a consequence of these transactions, the size of the money supply has
A. increased by $5,000. B. increased by $4,000. C. not been affected. D. decreased by $5,000.
The relationship between planned real consumption expenditures of households and their current level of real disposable income is
A) the consumption function. B) saving. C) dissaving. D) investment.
Refer to Figure 13-11. What is the amount of excess capacity?
A) Q3 - Q2 units B) Q3 - Q1 units C) Q4 - Q2 units D) Q4 - Q3 units
Which of the following best illustrates the free-rider problem? a. A tollbooth is constructed at the entrance of a privately funded highway
b. Individuals contribute toward a national defense program by paying taxes to the government. c. Some homeowners in a mountain resort area refuse to contribute toward paving the area's only access road. d. You erect a locked gate around your swimming pool to keep out unsupervised children.