If you were a creditor you would prefer
A. deflation.
B. disinflation.
C. unanticipated inflation.
D. anticipated inflation.
A. deflation.
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An example of how GNP accounts for services provided by foreign-owned capital (and GDP does not) is
A) earnings of a Spanish factory with British owners counts only in Spain's GDP. B) earnings of a Spanish factory with British owners counts only in Britain's GNP. C) earnings of a Spanish factory counts in Spain's GNP but are part of Britain's GDP. D) earnings of a Spanish factory counts in Spain's GDP but are part of Britain's GNP. E) earnings of a Spanish factory counts in Spain's GNP but not in Britain's GDP or GNP.
Everything else held constant, an expansionary ________ policy will cause the interest rate to rise, while an expansionary ________ policy will cause the interest rate to fall
A) monetary; monetary B) monetary; fiscal C) fiscal; monetary D) fiscal; fiscal
Which of the following is NOT a true statement regarding free trade?
A) Free trade promotes specialization and efficient production. B) Free trade generally reduces the domestic prices of imports. C) Free trade may stimulate economic growth through export sales. D) Every individual in a country gains short-term benefits from free trade.
What is a benefit of giving the government freedom to spend more than they receive in taxes and run a deficit?
A. It allows the government to be flexible if something unexpected happens. B. It can make it more difficult for businesses and consumers to borrow. C. There is never a good enough reason to allow public debt. D. The federal government cannot run a deficit.