Under a gold standard, as trade takes place, the importing nation experiences a ________ and a(n) _________ in its money supply, while the exporting nation experiences the opposite.
A) gold outflow; contraction
B) gold inflow; expansion
C) gold outflow; expansion
D) gold inflow; contraction
Ans: A) gold outflow; contraction
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Suppose output is $35 billion, government purchases are $10 billion, consumption is $15 billion, and net exports are $4 billion. Assume net factor payments equal 0
(a) Calculate the equilibrium amount of investment. Show your work. (b) Calculate the equilibrium amount of absorption. Show your work. (c) Calculate the equilibrium amount of the financial account balance. Show your work.
Which of the following events best exemplifies the concept of signaling?
a. A college student's parents, having learned that their child is short of money, send her a check for $1,000. b. A new company making high quality bicycles at a reasonable price sends free bikes to reviewers working for bicycle magazines. c. A grocery store maintains a policy of examining the driver's license of everyone who writes a personal check to purchase his groceries. d. A university maintains a policy of considering for admission only those students who graduated among the top ten percent of their high school class.
One of the contributing factors to the financial crisis of 2007-2009 was that mortgage lending practices were ____________ strict in the late 1990s and early 2000s, compared to earlier periods such as the 1970s and 1980s, which led to a(n) _______________ in subprime and other nontraditional mortgage loans
A) less; increase B) more; increase C) less; decline D) more; decline
Which of the following is NOT a cause for real wage rigidity?
A. minimum-wage laws B. unemployment insurance C. union power D. efficiency wages