In the open-economy ISLM model, net export is specified as a function of and exchange arte is specified as a function of
A) output; output.
B) money supply; interest rate.
C) exchange rate; interest rate.
D) exchange rate; money demand.
C
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All of the following lead to more rapid economic growth EXCEPT
A) restricting international trade. B) encouraging higher rates of saving. C) supporting more research and development. D) encouraging higher quality education.
Use the aggregate expenditures model and assume the marginal propensity to consume (MPC) is 0.80 . A decrease in government spending of $1 billion would result in a decrease in GDP of:
a. $0. b. $0.8 billion. c. $1.0 billion. d. $5.0 billion. e. $8.0 billion.
Business cycle troughs are always followed by the _____ phase.
Fill in the blank(s) with the appropriate word(s).
Refer to the diagrams. Curve A:
A. is an investment schedule and curve B is a consumption of fixed capital schedule.
B. is an investment demand curve and curve B is an investment schedule.
C. and curve B are totally unrelated.
D. shifts to the left when curve B shifts upward.