Which of the following will increase economic freedom?
a. low rates of inflation and easy access to money that maintains its purchasing power
b. high tariff rates
c. government spending that comprises a large share of the economy
d. rapid and unpredictable inflation
A
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The investment function implies that current output does not influence investment. Does that make sense?
What will be an ideal response?
What best explains the pattern of bank collapses in the US?
a. The vast majority of banks closed early in the decade and the closing dropped significantly in the latter half of the decade. b. Banks collapsed consistently throughout the 1930s. c. The failure rate was relatively low early in the decade and grew steadily throughout the period.
Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. 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 the nominal value of the domestic currency in the context of the Three-Sector-Model?
a. The quantity of real loanable funds per time period rises, and nominal value of the domestic currency falls. b. The quantity of real loanable funds per time period falls, and nominal value of the domestic currency rises. c. The quantity of real loanable funds per time period rises, and nominal value of the domestic currency remains the same. d. The quantity of real loanable funds per time period rises, and nominal value of the domestic currency rises. e. There is not enough information to determine what happens to these two macroeconomic variables.
When Roxanne, a U.S. citizen, purchases a designer dress from Barneys of New York that was made in Milan, the purchase is
A) a U.S. import and an Italian export. B) both a U.S. and an Italian import. C) a U.S. export and an Italian import. D) neither an export nor an import for either the United States or Italy.