The net exports effect is the ____ relationship between net exports and the price level of an economy.
A. inverse
B. independent
C. direct
D. linear
Answer: A
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If the inflation rate in 2014 was 12.5 percent and the price index for 2012 (the base year) was 100, the price index for 2014 was _____
a. 120.5 b. 121.5 c. 112.5 d. 102.5
Which of the following components of aggregate expenditure is most subject to crowding out?
a. Consumption expenditures b. Investment spending c. Imports d. Government purchases of goods and services e. National saving
How is a firm's vertical scope determined?
During the 1970s, U.S. prices generally rose faster than prices in other parts of the world. Which of the following changes would the open economy effect predict took place in response to these price level changes? a. Americans reduced the proportion of foreign goods bought since their foreign prices became relatively lower. b. Americans reduced the amount of investment they undertook because
interest rates increased. c. Americans reduced the amount of goods and services they wanted to purchase for consumption because they felt less wealthy. d. Americans reduced the fraction of purchases they made from domestic producers of goods and services, since foreign prices became relatively lower.