The primary function of the International Monetary Fund is
A. to provide loans only to private firms in developing countries.
B. to make direct, irrevocable transfers of funds from wealthy nations to poor nations.
C. to make loans aimed at promoting global stability and hence growth.
D. to lend solely on the basis of a nation's relative poverty.
Answer: C
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National League pitchers partake in some batting practice (typically, bunting). Why don't American League pitchers practice batting?
A) Practice can't be expected to improve their terribly poor batting skills. B) They have little incentive, given the designated hitter rule. C) They don't believe the slogan "There is no 'I' in 'Team'." D) They ignore the rules of the game.
Assume that the government has a target value, X, for the current account surplus
(a) What is the goal of external balance? (b) Assume that we are dealing with only the short run, what are the values of P and P?? (c) Given fixed P and P , what would happen if E rises? (d) Given P and P , what would happen if T decreases, i.e., an expansionary fiscal policy? (e) Given P and P , what would happen if G increases, i.e., an expansionary fiscal policy? (f) Given all of the above, what is the relation between the exchange rate, E, and fiscal ease, i.e., an increase in G or a reduction in T? (g) Assume that the economy is in external balance. What will happen if the government maintains its current account at X, but devaluates the domestic currency? (h) Assume that the economy is at external balance. What will happen if the government raises E? (i) Assume that the economy is at external balance. What will happen if the government lowers E?
When society receives more benefits from a good than the individuals who consume the good,
a. the marginal social benefit for the good is less than the marginal social cost b. too much of the good would be produced by a private market c. property rights are assignable and well defined d. the good produces a positive externality e. the good is exhaustible with fixed-production technology
The long-run result of government intervention in responding to a recession is:
A. the same level of output at higher prices. B. higher level of output at higher prices. C. higher level of output at lower prices. D. lower level of output at the same prices.