Japan's currency is called Yen. The value of Japan's income per capita in dollars is high if ________
A) the value of Japan's income per capita in yen is low
B) the income per capita of the U.S. is high
C) the dollar/yen exchange rate is high
D) the dollar/yen exchange rate is low
C
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Ricardian Equivalence theory assumes that ________
A) an anticipated increase in the income of future generations will reduce the amount that is saved today on their behalf B) government spending remains constant C) many people are subject to borrowing constraints D) tax cuts have a positive impact on aggregate supply
If the MPS = 0.25, and intended investment falls from $100 to $75, national income will decrease by
a. $25 b. $75 c. $150 d. $125 e. $100
Which country has the highest unemployment rate?
a. Spain b. Ireland c. Sweden d. France e. All have low unemployment
Suppose that there are diminishing returns to capital. Suppose also that two countries are the same except one has more capital per worker and so it has more real GDP per worker than the other. Finally, suppose that the saving rate in both countries increases from 4 percent to 7 percent. Over the next ten years we would expect that
a. the growth rate will not change in either country. b. the country that started with less capital per worker will grow faster. c. the country that started with more capital per worker will grow faster. d. both countries will grow and at the same higher rate.