In the open-economy macroeconomic model, the key determinant of net capital outflow is
a. the real exchange rate. When the real exchange rate rises, net capital outflow rises.
b. the real exchange rate. When the real exchange rate rises, net capital outflow falls.
c. the real interest rate. When the real interest rate rises, net capital outflow rises.
d. the real interest rate. When the real interest rate rises, net capital outflow falls.
d
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Which of the following statements is true?
A) If both demand and supply increase there must be an increase in equilibrium price; equilibrium quantity may either increase or decrease. B) An increase in demand causes a change in equilibrium price; the change in price does not cause a further change in demand or supply. C) If demand decreases and supply increases one cannot determine if equilibrium price will increase or decrease without knowing which change is greater. D) A decrease in supply causes equilibrium price to rise; the increase in price then results in a decrease in demand.
Suppose that the government is considering a policy to combat unemployment. If the government pays for increased spending by borrowing funds that otherwise would have been used for consumption and investment,
a. the positive effect of increased government spending is augmented by an increase in private spending. b. the negative effect of increased government spending is offset by an increase in private spending. c. the negative effect of increased government spending is augmented by a reduction in private spending. d. the positive effect of increased government spending is offset by a reduction in private spending.
Amy became a tour guide at a national park and was paid $20 per hour to conduct four two-hour tours per day. Each tour generated $400 in revenues for the park. Which of the following shows the marginal resource cost associated with Amy’s labor?
a. $20 hourly rate b. $360 profit per tour c. $1600 revenues per day d. $800 wages per week
Consider the following statements:
a. Soda drinkers purchase more soda from a grocery store that sells soda at a lower price than other rival grocery stores in the area. b. Homeowners do not take steps to increase security even though they believe it is more costly to allow burglaries than to install security monitoring equipment. c. Manufacturers produce less of a particular cell phone when its selling price rises. Which of the above statements demonstrates that economic agents respond to incentives? A) a only. B) b only. C) c only. D) a and b. E) a, b, and c.