Under a floating exchange-rate regime with a low degree of capital mobility, if the domestic government uses an expansionary fiscal policy
A. the financial account balance deteriorates.
B. the official settlements balance tends to go into surplus.
C. foreign capital outflows decrease domestic product.
D. the domestic interest rate increases.
Answer: D
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If a production quota is set below the equilibrium quantity, at the quota quantity, marginal benefit is ________ marginal cost and the level of production is ________
A) greater than; inefficient B) greater than; efficient C) less than; inefficient D) equal to; efficient
Refer to the above figure. Which panel is consistent with the Fed selling bonds?
A) Panel A B) Panel B C) Panel C D) Panel D
\What are the marginal propensity to consume (MPC) and the marginal propensity to save (MPS)? How is the MPC related to the consumption function?
Refer to Figure 7.1. Which of the following statements is incorrect?
A. Bundle A costs less than bundle E. B. Bundle C costs as much as bundle D. C. Bundle B costs more than bundle C. D. Bundle F costs more than bundle C.