A closed economy
a. does not engage in international trade of goods and services.
b. does not engage in international borrowing or lending.
c. both A and B
d. engages in international borrowing and lending.
c
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Which of the following goods is given in the textbook as an example of a good whose price is subject to volume penalties?
A. Electricity B. Pizza C. Beer D. Yogurt
Describe one of the two reasons given in the textbook to help explain why price and quantity demanded are inversely related
Which statement is true?
A. The supply curve in the market period is always perfectly inelastic. B. The supply curve for a perishable good, such as ripe strawberries, is perfectly elastic. C. Business firms cannot respond to increases in demand for their product in the short run. D. The long-run supply curve is more elastic than the short-run supply curve.
An increase in the effective tax rate on capital would cause the IS curve to ________ and the LM curve to ________.
A. shift up and to the right; shift up and to the left B. shift up and to the right; be unchanged C. shift down and to the left; be unchanged D. shift down and to the left; shift up and to the left