One reason for increasing costs industries is that as an industry grows, it drives up the prices of inputs.
Answer the following statement true (T) or false (F)
True
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Consider a large open economy. What are the effects, in equilibrium, on the world real interest rate, domestic national saving, domestic investment, the domestic current account balance, foreign national saving, foreign investment, and the foreign
current account balance in each of the following scenarios? Show a diagram to illustrate your results. (a) current income rises in the foreign country (b) the future marginal product of capital rises in the domestic country (c) wealth rises in the foreign country
In the long run, the output level is determined by
A. aggregate demand. B. aggregate supply. C. household income. D. the government.
Describe how a lender can lose during inflation if the inflation is unanticipated and the loan is a fixed-interest-rate loan. How would a variable-interest-rate loan (one that adjusts over the contract period) eliminate these loses?
What will be an ideal response?
Okun's Law states that the ________ decreases about 1 percentage point for every 3% increase in ________.
A. GDP; the inflation rate B. inflation rate; the unemployment rate C. inflation rate; GDP D. unemployment rate; GDP