Which of the following transactions will be included in the financial account of the balance of payments of any country?
a. Travel and tourism expenses
b. Import of goods
c. Investment in stock
d. Export of services
e. Payment of insurance premium
c
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Bank reserves can be viewed as:
a. Profitable assets in a bank's portfolio. b. Taxes on profits. c. Assets that all banks should have in excess, if they want relatively high profits and relatively low risks. d. All the above.
Everything else remaining unchanged, what is likely to happen to the equilibrium real interest rate and quantity of credit if the credit demand curve shifts to the right?
A) Both equilibrium rate of interest and quantity of credit will decrease. B) The equilibrium rate of interest will decrease and the quantity of credit will increase. C) Both equilibrium rate of interest and quantity of credit will increase. D) The equilibrium rate of interest will increase and the quantity of credit will decrease.
Refer to the scenario above. Which of the following statements will be true in steady state?
A) Economy A will have a lower capital stock and a greater GDP than economy B. B) Economy A will have a greater capital stock and a lower GDP than economy B. C) Economy A will have a greater capital stock and GDP than economy B. D) Economy A will have a lower capital stock and GDP than economy B.
If a firm wants to borrow $10 million and the real interest rate increases from 5 percent to 6 percent, then the cost of the investment has increased by
A) $6 million per year. B) $100,000 per year. C) $1 million per year. D) $600,000 per year. E) nothing because the real interest rate is the return the firm will earn on its investment.