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 the quantity of real loanable funds per time period and current international transactions in the context of the Three-Sector-Model?
a. The quantity of real loanable funds per time period falls, and current international transactions become more negative (or less positive).
b. The quantity of real loanable funds per time period rises, and current international transactions become more negative (or less positive).
c. The quantity of real loanable funds per time period and current international transactions remain the same.
d. The quantity of real loanable funds per time period rises, and current international transactions remain the same.
e. There is not enough information to determine what happens to these two macroeconomic variables.
.A
You might also like to view...
In the 1920s and 1930s, economists became increasingly aware that there were industries that did not fit the model of perfect competition or pure monopoly. Two separate theories of monopolistic competition resulted
Edward Chamberlin of Harvard published the Theory of Monopolistic Competition in 1933. Chamberlin defined monopolistic competition as A) a relatively large number of producers offering similar but differentiated products. B) a relatively small number of producers offering similar but differentiated products. C) a market situation in which a large number of firms produce identical products. D) a market situation in which a small number of firms produce similar products.
A consumer is likely to _____________ his opportunity costs when ____________.
A. undervalue; they are not right in front of him B. undervalue; they are obvious C. overvalue; they are not obvious D. overvalue; they are right in front of him
Which of the following correctly describes the trend in the federal budget during the 1980s?
a. Federal spending declined relative to GDP, while federal revenues rose relative to GDP. b. Federal spending rose relative to GDP, while federal revenues declined relative to GDP. c. Balanced budgets were passed though cooperation between the president and Congress. d. The dollar depreciated, thereby lowering the deficit.
The empirical and theoretical results on occupational crowding in the United States suggest that
A. occupational crowding is substantial in the United States, but this should not be thought of as a source of discrimination. B. occupational crowding is substantial in the United States, and much of this should be thought of as a source of discrimination. C. there is minimal occupational crowding in the United States, and therefore it cannot be a source of discrimination. D. there is minimal occupational crowding in the United States, but this is still thought to be an important cause of racial discrimination but not gender discrimination. E. occupational crowding is substantial in the United States, but occupational crowding is unrelated to discrimination.