The value of output was $1,000 billion in Northland and $2,000 billion in Southland. The population of Northland was 50 million and the population of Southland was 120 million. There were 30 million employed workers in Northland and 75 million employed workers in Southland. Average labor productivity was higher in ________ and the standard of living was ________.
A. Southland; the same in both countries
B. Northland; higher in Northland
C. Northland; the same in both countries
D. Southland; higher in Southland
Answer: B
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Use the following table of U.S. balance of payments accounts to answer the next question.Current AccountFinancial AccountCapital AccountCreditDebitCreditDebitCreditDebit$45 billion$60 billion$72 billion$52 billion$7 billion$12 billionSuppose the U.S. exports $10 billion of coal to France. Which of the following statements is true?
A. The increase in the financial account credit of $10 billion will reduce the capital account credit by $2 billion and the current account credit by $8 billion. B. The increase in the capital account debit of $10 billion will increase the financial account debit by $10 billion as well. C. The increase in the current account debit of $10 billion will be offset by an increase in the capital account of $10 billion. D. The increase in the current account credit causes an increase in the financial and capital account surpluses of $5 billion each.
If the Federal Reserve conducts an open market sale, the
A) interest rate will decrease. B) interest rate will increase. C) interest rate will not change. D) money supply is increased.
Monetarism begins and ends with one obsession: _________________.
Fill in the blank(s) with the appropriate word(s).
Currently, if inflation is 2 percent and the goods inflation target is 2.5 percent, policymakers:
A. congratulate themselves for coming in under their target. B. are indifferent because they don't have an inflation target. C. are indifferent because they are more interested in asset inflation. D. are unhappy because they have come in under their target.