An unanticipated increase in the money supply will lead to
What will be an ideal response?
a decline in interest rates, an increase in investment, and an increase in aggregate demand
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If a German firm owns a U.S.-based firm that is domiciled in the U.S., the combined firm is subject to the corporate tax laws in ________ and income tax laws in ________.
A) Germany; Germany B) Germany; U.S. C) U.S.; Germany D) U.S.; U.S.
The nominal interest rate is the
a. interest rate corrected for inflation. b. interest rate as usually reported by banks. c. real rate of return to the lender. d. real cost of borrowing to the borrower.
Traditionally, the major objection to flexible rates was that they ______.
a. introduce considerable uncertainty into international trade b. were controlled solely by the U.S. government c. require special financial borrowings or reserve movements d. can result in currency shortages
A balance-of-payments surplus can be reduced with
A. Increased government spending. B. Contractionary monetary policy. C. Increased tariffs and quotas on foreign goods. D. Increased taxes.