In the open-economy macroeconomic model, the key determinant of net capital outflow is the
a. nominal exchange rate.
b. nominal interest rate.
c. real exchange rate.
d. real interest rate.
d
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The oligopolistic situation in which a company's objective is to maximize revenue subject to a minimum profit requirement is usually referred to as
A) the aggregate model. B) the Baumol model. C) the aggressive model. D) the Marshall model.
The third step of the four step process is to
a. identify the new equilibrium and then compare the original equilibrium price and quantity to the new equilibrium price and quantity. b. decide whether the economic change being analyzed affects demand or supply. c. draw a demand and supply model before the economic change took place. d. decide whether the effect on demand or supply causes the curve to shift to the right or to the left, and sketch the new demand or supply curve on the diagram.
The Federal Open Market Committee (FOMC) enters the market to purchase $10 million in securities. Suppose the Paris First National Bank decides to sell $10 million of the securities it owns to the FOMC; then
a. the Paris First National Bank now has $10 million more in excess reserves at the Fed b. the Paris First National Bank still has the $10 million government securities but they are held at the Fed c. this purchase and sale appears as a $20 million increase in the Fed's liabilities to Paris First National Bank d. the Fed has increased its asset position by $20 million, the bank's liabilities fall by $20 million e. there is no change to either the Fed or Paris First National Bank's balance sheet, there's just a trade-off of equal value
An adverse supply shock will shift short-run aggregate supply
a. right, making prices rise.
b. left, making prices rise.
c. right, making prices fall.
d. left, making prices fall.