If the U.S. inflation rate increases unexpectedly and government revenues, expenditures, and nominal interest rates remain unchanged:
A. both the U.S. real and nominal budget deficits decreases.
B. only the U.S. real budget deficit increases.
C. both the U.S real and nominal budget deficits increases.
D. only the U.S. real budget deficit decreases.
Answer: D
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Exports ________ society's total surplus because of the ________ in price and ________ in production
A) increase; rise; increase B) increase; rise; decrease C) decrease; fall; increase D) decrease; fall; decrease E) increase; fall; increase
Which of the following transactions would be included in the U.S. balance of payments?
a. A U.S. resident buys a bus ticket from Dallas to El Paso, Texas. b. U.S. manufacturers sell thousands of cars to Canadian buyers. c. A U.S. resident pays a fee to obtain a passport to travel abroad. d. Canadian oil companies pay a Dutch firm to design an oil pipeline.
Which of the following is an example of a scarce good?
What will be an ideal response?
In 1991 the federal government changed the withholding amounts for personal taxes. The change meant that people wouldn't have as much withheld from their paychecks. But there was no change in the tax code itself, so the amount of tax due in April 1992 was not changed. How would consumption and saving respond to this withholding change? (Note: you may assume a real interest rate of 0%.)
What will be an ideal response?