Answer the following questions true (T) or false (F)
1. The total value of production from Ford's manufacturing plant in Cologne, Germany would be included in Germany's gross national product.
2. Transfer payments are subtracted from national income to get to personal income.
3. For developed countries like the United States, GDP will always exceed GNP.
1. FALSE
2. FALSE
3. FALSE
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Expansionary fiscal policy falls short of its goal. Some economists claim it is due to indirect crowding out. What evidence would be consistent with this claim?
A) The interest rate increased. B) The price level decreased. C) Saving decreased. D) An increase in consumer spending occurred.
Suppose that an increase in a nation's income causes the nation's residents to buy more domestic and foreign goods. Given this, if U.S. residents experience an increase in income, but Mexican residents do not, it is likely that, ceteris paribus,
A) both the U.S. dollar and the Mexican peso will depreciate. B) both the U.S. dollar and the Mexican peso will appreciate. C) the U.S. dollar will depreciate and the Mexican peso will appreciate. D) the U.S. dollar will appreciate and the Mexican peso will depreciate.
The price at which a good or service is traded on international markets is called the ________ price.
A. universal B. international C. market D. world
Which of the following factors can lead to an increase in demand for coffee at Starbucks?
A. An increase in the price of coffee beans B. An increase in the price of sugar C. A 10 percent decline in local population D. An increase in household income