In an open economy, a decrease in the government's budget deficit will ________ the domestic real interest rate and ________ the level of capital investment in the country, holding other factors constant.
A. increase; increase
B. decrease; decrease
C. decrease; increase
D. increase; decrease
Answer: C
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Answer the following statement(s) true (T) or false (F)
1. The spot market is the market for goods that are to be delivered at a particular location, or “at that spot”. 2. There are three types of decision makers in a market economy, consumers, firms and resource suppliers. 3. Tastes and preferences are relevant to individual choices for consumption but not relevant to choices for supplying labor. 4. An individual's indifference curves between labor and consumption are upward sloping because both are desired. 5. Higher wages always cause a worker to increase the quantity of labor supplied.
Which of the following statements is true of the unemployment rate in a country?
A) It is not correlated with the level of economic activity in a country. B) It normally decreases during periods of both economic expansion and contraction. C) It normally increases during periods of economic expansion and decreases during periods of economic contraction. D) It normally decreases during periods of economic expansion and increases during periods of economic contraction.
How do the Fed's actions change the exchange rate?
What will be an ideal response?
Who is considered to be a free rider according to economists?