If all the countries used one common currency, we could expect that exports and imports would
a. decrease because international trade would be less needed
b. decrease because each country would be producing more output
c. increase because exchange rate uncertainty would be eliminated
d. increase because many small countries would benefit most
e. not change because trading of goods is independent of currency
C
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To the extent that a direct expenditure offset results from an expansionary fiscal policy,
A) the fiscal policy will not be discretionary. B) the time lags associated with the implementation of fiscal policy will shorten. C) the stimulative effect will be less than anticipated. D) the stimulative effect will be more than anticipated.
What is the relationship among the current account, the financial account, and the balance of payments?
What will be an ideal response?
The dominant strategy allows a firm to
A) obtain the highest benefit, regardless of its rivals' actions. B) transform a negative-sum game into a positive-sum game. C) transform a zero-sum game into a positive-sum game. D) escape from a Prisoners' Dilemma situation.
Beginning from full-employment macro equilibrium, increase in government spending will cause real GDP to: a. increase in the short run. b. decline in the long run
c. decline in the short run. d. increase in the long run.