The main international repercussion of either a fiscal expansion or monetary contraction is to
A. raise interest rates and the exchange rate, thereby crowding out net exports.
B. raise interest rates and lower the exchange rate, thereby crowding in net exports.
C. lower interest rates and the exchange rate, thereby crowding in net exports.
D. lower interest rates and raise the exchange rate, thereby crowding out net exports.
Answer: A
You might also like to view...
Maria lives next door to Alice. Alice regularly plays loud music, which often disturbs Maria. Maria went over to Alice's house yesterday and asked her to turn down her music because loud music adversely affects her. Alice has complied. Which of the following best describes the economists' view of what has happened?
A. The marginal social benefits of loud music were greater than the marginal private costs of loud music and the problem was solved by Maria persuading Alice to internalize her (Maria's) external costs. B. The marginal social costs of loud music were greater than the marginal private costs of loud music and the problem was solved by Maria persuading Alice to internalize her (Maria's) external costs. C. The marginal social costs of loud music were greater than the marginal private costs of loud music and the problem was solved through a reassignment of property rights. D. The marginal social costs of loud music were greater than the marginal social benefits of loud music and the problem was solved by Maria persuading Alice to internalize her (Maria's) external costs. E. none of the above
Which of the following is true?
a. International trade makes it possible for a country's consumption possibilities to exceed its production possibilities. b. International trade requires that a country's production possibilities exceed its consumption possibilities. c. A country's production possibilities always equal its consumption possibilities. d. A country's consumption possibilities can never equal its production possibilities because of leakages in the system. e. As long as there is full employment of resources, a country's production possibilities will exceed its consumption possibilities even with trade.
Because of the lack of buyer's information about a perfectly functioning used car:
A. the market will eventually become saturated with high quality cars. B. sellers of perfectly functioning used cars will be more likely to enter the market. C. the buyer will pay less than what it's worth because of the chance that it will be a lemon. D. All of these statements are true.
Not having to pay for a good leads to:
A. oversupply. B. overconsumption. C. underconsumption. D. irrational consumption.