The level of saving in the United States has historically been low relative to the level of domestic investment. Based on this information, we would expect that
A) U.S. private saving is less than its public saving.
B) U.S. capital inflows are negative.
C) U.S. net foreign investment has been relatively high.
D) U.S. net exports have been relatively low.
D
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For years, economists believed that market structure explained the ability of some firms to earn economic profits
For example, firms in industries with little competition and high barriers to entry would earn higher profits than firms in competitive industries with low entry barriers. Which of the following has caused economists to question this explanation and seek other explanations for why firms are profitable? A) In recent years, new technologies have increased the potential entry of new firms in industries with high entry barriers. B) Studies have shown that, on average, firms in competitive industries earn higher profit rates than firms in industries with little competition. C) The market structure explanation fails to explain how firms in the same industry can have very different levels of profit. D) Studies have shown that firms in industries that have little competition and high entry barriers are not very profitable. Economists conclude from this that some competition is necessary in order to force firms to lower their costs and develop products that satisfy new consumer demands.
Suppose that changes in the interest rate have absolutely no effect on the demand for money. The resulting ________ LM curve causes monetary policy to have ________ effect in changing income
A) horizontal, no B) horizontal, an unusually strong C) vertical, no D) vertical, an unusually strong
An unsterilized foreign-exchange intervention occurs
A) whenever a central bank purchases or sells domestic currency. B) whenever a central bank purchases or sells foreign currency. C) whenever a central bank allows the monetary base to respond to the sale or purchase of domestic currency. D) whenever a central bank fails to reduce its holdings of gold by the amount of a foreign-exchange purchase.
If a demand curve for a good were completely vertical, it would be considered:
a. perfectly elastic. b. perfectly inelastic. c. of unitary elasticity. d. relatively inelastic.