What is meant by scientific method?
What will be an ideal response?
The unbiased development and testing of theories about how the world works.
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How is net present value used to decide whether a project should be undertaken or not?
What will be an ideal response?
A country will be able to consume a combination of goods that is not attainable solely from domestic production if
A) the world terms of trade differ from its domestic relative costs. B) the country specializes in one product. C) the country avoids international trade. D) the world terms of trade equal the domestic relative costs. E) the country's domestic production value equals world relative value.
Which of the following is true of index numbers? a. Index numbers are always represented without units
b. The index number for a base year is always less than 100. c. Index numbers can never be more than 120. d. The index number for a year when subtracted from the base year index yields inflation.
Assume that the central bank increases the reserve requirement. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to real GDP and net nonreserve-related international borrowing/lending in the context of the Three-Sector-Model?
a. Real GDP falls, and net nonreserve-related international borrowing/lending becomes more negative (or less positive). b. Real GDP rises, and net nonreserve-related international borrowing/lending becomes more negative (or less positive). c. Real GDP falls, and net nonreserve-related international borrowing/lending becomes more positive (or less negative). d. Real GDP and net nonreserve-related international borrowing/lending remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.