Assume that the expectation of declining housing prices cause households to reduce their demand for new houses and the financing that accompanies it. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the quantity of real loanable funds per time period and GDP Price Index in the context of the Three-Sector-Model?
a. The quantity of real loanable funds per time period falls, and GDP Price Index rises.
b. The quantity of real loanable funds per time period falls, and GDP Price Index falls.
c. The quantity of real loanable funds per time period rises, and GDP Price Index falls.
d. The quantity of real loanable funds per time period falls, and GDP Price Index remains the same.
e. There is not enough information to determine what happens to these two macroeconomic variables.
.B
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If the Japanese yen was 123 per dollar and now it is 114 yen per dollar, it can be said that
A) the yen has appreciated against the dollar. B) the yen has depreciated against the dollar. C) the dollar has appreciated against the yen. D) Both answers C and B are correct
If the demand curve for a good is unit elastic, then total expenditure will _____ as the price of the good decreases.
A. remain constant B. fall C. rise D. go to zero
The Herfindahl-Hirschman index
A. is no longer applicable to the American economy. B. measures the degree of concentration within an industry. C. seldom goes above 100. D. falls as the degree of concentration rises.
The higher the reservation wage, the more likely one is to be unemployed.
Answer the following statement true (T) or false (F)