A large open economy's real interest rate will decrease if
A. the expected future marginal product of domestic capital rises.
B. there is a temporary positive domestic supply shock.
C. the expected future marginal product of foreign capital rises.
D. there is a temporary negative domestic supply shock.
Answer: B
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To maintain a fixed exchange rate, authorities
A) make laws stipulating the exchange rate. B) modify money supply. C) modify government expenses. D) modify taxes.
Lisa consumes only pizzas (P) and burritos (B). Her utility function is U = P0.5 B0.5. The price of per pizza is $10 and the price per burrito is $5. In equilibrium, Lisa consumes four pizzas
Using Lisa's utility function, calculate how many burritos she consumes.
To find the market demand curve for a product, we sum the individual demand curves a. vertically
b. diagonally. c. horizontally. d. perpendicularly.
A theory of distributional justice that concludes that the social contract emerging from the original position would call for an income distribution that would maximize the well-being of the worst-off member of society is known as
A. relative justice. B. maxi-min justice. C. utilitarian justice. D. Rawlsian justice.