Nations that borrow from abroad to support current consumption:
A. will always be better off in the future.
B. will always sacrifice future consumption.
C. may sacrifice future consumption.
D. will always sacrifice current consumption.
Answer: B
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Modern U.S. commercial banks perform all of the following functions EXCEPT
A) accept checking deposits. B) issue paper currency. C) make loans to households and business firms. D) accept savings deposits.
Any two of these events in questions 1 and 2 occur together? (Draw the diagrams!)
What will be an ideal response?
Economic growth will
a. reduce the future real GDP of an economy. b. expand the production possibilities of an economy. c. increase an economy's nominal income, but not its real income. d. increase real output, but the real income level of the country will decline.
Externalities are
a. side effects passed on to a party other than the buyers and sellers in the market. b. side effects of government intervention in markets. c. external forces that cause the price of a good to be higher than it otherwise would be. d. external forces that help establish equilibrium price.