Most developing countries rely on foreign financing because:
a. ?these countries do not generate enough savings to fund investments.
b. ?foreign financing is more reliable than domestic investments.
c. ?investors do not recognize their potential gains.
d. ?foreign countries are more than willing to invest in developing countries.
e. ?their governments are unstable and run on deficits.
Answer: a. These countries do not generate enough savings to fund investments.
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Refer to Figure 7.1. Suppose the city passes an ordinance banning loud music, and this directly impacts Angus's legal ability to play his bagpipes. In this case, the property rights belong to
A) Angus. B) Dudley. C) no one. D) both Angus and Dudley.
As a result of the 2008-2009 financial crisis and the decrease in GDP in many European economies, we would expect
A) an increase in the demand for U.S. exports and a leftward shift in the demand curve for dollars. B) a decrease in the demand for U.S. exports and a leftward shift in the demand curve for dollars. C) a decrease in the demand for U.S. exports and a rightward shift in the demand curve for dollars. D) a decrease in the demand for U.S. imports and a movement up along the demand curve for dollars.
The formula for the multiplier is (1 - MPC)
Indicate whether the statement is true or false
An example of an explicit cost of production would be the
a. cost of forgone labor earnings for an entrepreneur. b. lost opportunity to invest in capital markets when the money is invested in one's business. c. lease payments for the land on which a firm's factory stands. d. Both a and c are correct.