Suppose the current account has a value of $500,000 and the financial account has a value of $525,000. The value of the capital account is ________.
A. $25,000
B. -$1,025,000
C. $1,025,000
D. -$25,000
Answer: C
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According to the factor price equalization theorem, free international trade will result in wages equating rents worldwide
Indicate whether the statement is true or false
Suppose an increase in government spending stimulates real GDP without affecting the price level. What is the relevant range of the aggregate supply curve in this case?
a. The classical range. b. The intermediate range. c. The Keynesian range. d. The monetarist range.
An economic model:
A. exactly explains what happens in the real economy. B. approximates all facets of what happens in the real economy. C. does not make clear assumptions about the economic activity. D. discards unnecessary details to clearly demonstrate the central principles of the economic activity.
Which of the following is NOT a reason that people tend to deposit their funds with banks rather than lend their funds directly to other individuals?
A. liquidity problems B. asymmetric information problems C. moral hazard problems D. adverse selection problems