A country has I = $200 billion, S = $400 billion, and purchased $600 billion of foreign assets, how many of its assets did foreigners purchase?
a. $0
b. $200 billion
c. $400 billion
d. $800 billion
c
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As the housing bubble began to burst in 2006-2008, investors would only buy mortgage-backed securities at high yields to compensate for higher perceived default risk. As a result::
A) banks suffered significant capital losses as the value of their holdings of mortgage-backed securities declined B) funds available for mortgages increased C) bank profits rose as they earned higher interest on mortgages D) the price of mortgage-backed securities tended to rise due to the higher yields
Suppose that most government spending was on capital goods that contribute to economic growth. How would that affect the Ricardian equivalence debate?
What will be an ideal response?
Which of the following sentences is a positive claim and which is a normative claim? We need a higher minimum wage. Working people at minimum wage are not above the poverty level. That is not fair. But a higher minimum wage will mean that some low wage workers will be laid off and have no job.
What will be an ideal response?
Refer to the information provided in Figure 2.5 below to answer the question(s) that follow.
Figure 2.5Refer to Figure 2.5. The marginal rate of transformation in moving from Point B to Point A is
A. -2/3. B. -3/4. C. -1.5. D. -20.