The FE curve illustrates all combinations of domestic output levels and interest rates for which
A. the domestic product market is in equilibrium.
B. there is full employment.
C. the domestic money market is in equilibrium.
D. there is a zero balance for the country's official settlements balance.
Answer: D
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The table above shows the marginal costs and marginal benefits of college education. If the market for college education is perfectly competitive and unregulated, the amount of enrollment is
A) efficient. B) inefficient because marginal social cost exceeds marginal social benefit. C) inefficient because marginal social benefit exceeds marginal social cost. D) inefficient because the quantity of education demanded exceeds the quantity of education supplied.
As DVDs become popular substitutes for video cassettes, demand for video cassettes is likely to
a. become less price elastic b. become more price elastic c. increase d. stay the same e. become unit elastic
Which of the following is true?
a. The U.S. current account deficit is a financial obligation of the federal government. b. A nation cannot run a current account deficit over a long period. c. A country with relatively poor (compared with other countries) domestic investment opportunities and a high saving rate will tend to run a current account deficit. d. A country with highly attractive (compared with other countries) domestic investment opportunities and a low saving rate will tend to run a current account deficit.
Credit cards are
a. a medium of exchange. b. counted as part of M2 but not as part of M1. c. important for analyzing the monetary system. d. All of the above are correct.