Ceteris paribus, if interest rates in the United States rise relative to those abroad, then the surplus in the U.S. capital account would
A. Become smaller and the dollar would depreciate.
B. Grow larger and the dollar would depreciate.
C. Grow larger and the dollar would appreciate.
D. Become smaller and the dollar would appreciate.
Answer: C
You might also like to view...
The creation of the Social Security program had no impact on the labor force participation rate because people are not interested in working past the age of 65.
Answer the following statement true (T) or false (F)
Answer the following statement(s) true (T) or false (F)
1. Physical capital generally has a positive impact on economic growth, but a negative impact on labor productivity. 2. If Keely’s company has 200,000 acres of farmland and adds 10 new workers to its team every year, the quantity of capital per worker will rise, but it will rise less and less every year. 3. In a country with little capital, a small increase in capital will result in a large increase in productivity. 4. The effects of diminishing marginal returns to capital are inescapable and cannot be mitigated. 5. According to Paul Romer, continuous innovation can result in unending economic growth.
The self-correcting tendency of the economy means that rising inflation eventually eliminates:
A. unemployment. B. exogenous spending. C. recessionary gaps. D. expansionary gaps.
In which of the following industries are economies of scale exhausted at relatively low levels of output?
A. Aircraft production. B. Automobile manufacturing. C. Concrete mixing. D. Newspaper printing.