Which of the following statements is true?
A. Current account balance = -(capital account balance).
B. A country's balance on current account equals its balance on capital account.
C. If the market for a nation's currency is in equilibrium, a capital account surplus necessarily means a current account surplus.
D. Capital accounts and current accounts balances are determined by governments.
Ans: A. Current account balance = -(capital account balance).
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If the Federal Reserve increases the interest rate on bank deposits at the Fed, banks will want to hold
a. fewer reserves, so the money multiplier will fall. b. fewer reserves, so the money multiplier will rise. c. more reserves, so the money multiplier will fall. d. more reserves, so the money multiplier will rise.
Which of the following summarizes the Fisher Effect?
A. Nominal interest rates will rise with unexpected inflation. B. Nominal interest rates will rise with expected inflation. C. Real interest rates will rise with unexpected inflation. D. Real interest rates will rise with expected inflation.
An increase in productivity will:
a. Increase aggregate demand b. Increase aggregate supply c. Decrease aggregate supply and aggregate demand d. Increase aggregate supply and aggregate demand
One of the reasons that Real Gross Domestic Product is not synonymous with social welfare is
A. things produced by people under 18 are not counted. B. quality has remained steady. C. people substitute between goods. D. it ignores the value of leisure.