During a business cycle recession, it is very likely that real GDP will
A) be greater than potential GDP.
B) be less than potential GDP.
C) equal nominal GDP and equal potential GDP.
D) exceed nominal GDP.
E) equal nominal GDP but not equal potential GDP.
B
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When U.S. official reserves ________, the official settlements account balance becomes negative and when U.S. official reserves ________, the official settlements account balance becomes positive
A) increase; decrease B) decrease; increase C) increase; increase D) decrease; decrease E) More information is needed about the balances on the current account and the capital account in order to answer this question.
When the money supply is increased, what do monetarists expect to happen to the nominal or market rate of interest?
A. It will rise immediately. B. It will fall in the short run, then rise in the long run. C. It will rise in the short run, then fall in the long run. D. It will fall and remain lower.
Dumping is said to occur when
A. Foreign producers sell their goods abroad at prices lower than our average cost of production. B. Foreign producers sell their goods abroad at prices lower than their marginal cost of production. C. Some foreign countries have trade surpluses and others have a trade deficit. D. Foreign producers sell their goods in export markets at prices below domestic prices.
If labor markets were perfectly efficient, the unemployment rate would fall to zero.
Answer the following statement true (T) or false (F)