Explain why Argentina, one of the world's richest countries at the start of the twentieth century, has become progressively poorer relative to the industrial countries
[An alternative question: What explains Argentina's regress from riches to rags?]
As usual, the answer is complex, but the country's inward orientation and macroeconomic instability appear to be the major culprits.
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Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential B. expansionary; lower; potential C. expansionary; higher; potential D. recessionary; lower; lower
Fluctuations in the current account balance are mainly the result of fluctuations in
A) net interest. B) net exports. C) foreign reserves. D) net transfers. E) imports of capital.
Which of the following contains a list only of things that increase when the budget deficit of the U.S. decreases?
a. U.S. supply of loanable funds, U.S. net capital outflow, U.S. domestic investment b. U.S. supply of loanable funds, U.S. exports, the real exchange rate of the dollar c. U.S. interest rates, the real exchange rate of the dollar, U.S. domestic investment d. the real exchange rate of the dollar, U.S. net capital outflow, U.S. net exports
The price of gold is $300 per ounce in New York and 2,550 pesos per ounce in Mexico City. If the law of one price holds for gold, the nominal exchange rate is ________ pesos per U.S. dollar.
A. 85.5 B. 8.5 C. 0.118 D. 1.18