The IMF offers loans to developing countries in times of balance of payment constraints, but the IMF also faces strong criticisms because:
A. contractionary fiscal policy and expansionary monetary policy tend to be ineffective against balance of payment constraints.
B. contractionary fiscal and monetary policies are always undesirable for any developing country.
C. it employs economists that know little about developing countries and their economic affairs.
D. the conditions tend to be procyclical, therefore worsening the recessions.
Answer: D
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Suppose that a product benefits from a successful advertising campaign. The result is that
A) the supply of the product decreases. B) the supply of the product increases. C) the demand for the product increases. D) the demand for the product decreases.
Refer to Table 12.1. Assuming the inflation rate forecast to be accurate, which nation has the lowest real rate of return?
A) Japan B) Australia C) the United States D) South Africa
Refer to Figure 15-11. Suppose the local government imposes a $2.50 per month tax on cable companies. What happens to the price charged by the cable company following the imposition of this tax?
A) The price rises from PM but it increases by an amount greater than $2.50 to reflect the monopoly's markup. B) The price remains at PM. C) The price rises from PM but it increases by an amount less than $2.50. D) The price rises from PM to (PM + $2.50).
Explain three factors that would cause the dollar to appreciate