Current account surpluses are offset by
A) the liquidity balances.
B) capital account deficits.
C) unilateral transfers.
D) balance of trade surpluses.
B
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In the figure above, if the price is $8 a unit, is there a shortage or surplus and what is the amount of any shortage or surplus? What is the equilibrium price and quantity?
What will be an ideal response?
Use the classical IS—LM model to show the effects of a temporary decrease in government purchases on the equilibrium levels of output, the real interest rate, employment, the real wage, and the price level
What will be an ideal response?
When John's income was low, he could not afford to dine out and would respond to a pay raise by purchasing more frozen dinners. Now that his income is high, a pay raise causes him to dine out more often and buy fewer frozen dinners
Which graph in the above figure best represents John's Engel curve for frozen dinners? A) Graph A B) Graph B C) Graph C D) Graph D
Government debt is not a problem as long as the:
a. Assets a government purchases increase national productivity by an amount less than the private sector. b. Government spends the funds on consumption goods rather than investment goods, because consumption goods do not have to be amortized. c. Government can borrow from foreigners. d. Government can print money and repay the debt any time it wants. e. Nation's equity level is rising.