In the open-economy macroeconomic model, if investment demand increases, then
a. net exports and the real exchange rate rise.
b. net exports rise and the real exchange rate falls.
c. net exports fall and the real exchange rate rises.
d. net exports and the real exchange rate fall.
Answer: c. net exports fall and the real exchange rate rises.
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a. (i) only b. (i) and (ii) only c. (ii) and (iii) only d. (i), (ii), and (iii)
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If a pure monopolist is producing more output than the MR = MC output:
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Which of the following was an implication of the U.S. government's Clean Air Act Amendments (CAAA) of 1977?
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