When Sam in San Francisco buys stock in Fuji Film, he is contributing to:
A. capital outflow from the U.S.
B. capital outflow from Japan.
C. capital inflow to the U.S.
D. domestic investment in the U.S.
Answer: A
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Classical macroeconomic theorists believed that if the economy was in a slump, the government should ________.
A. increase spending B. maintain a balanced budget C. lower taxes D. print money
Investors often pay professional analysts to gather and monitor information on the creditworthiness of borrowers because
A) federal law requires it. B) most investors are risk neutral. C) the cost of acquiring information about a borrower's creditworthiness can be high. D) doing so increases the net-of-tax yield on most investments.
The government played a central role in directing the post-World War II economy, causing all of the following to occur except
(a) The reduction of entitlements, such as Social Security and unemployment benefits. (b) Massive spending by the federal government, justified by the Cold War. (c) Enormously expanded government infrastructure spending on things like highways, airports, education and research and development. (d) There is no "except"; all of the above occurred.
The main function of a platform firm is to
A) deal with the government on behalf of sellers. B) link producers with consumers. C) perform collective bargaining with sellers on behalf of buyers. D) create entry barriers for an industry on behalf of existing firms.