The difference between the current account balance and net exports is
A) the capital account.
B) net unilateral transfers plus net factor payments from abroad.
C) adjustments in net foreign assets.
D) income receipts from foreign assets.
B
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To achieve long-run equilibrium in an economy with a recessionary gap, without the use of stabilization policy, the inflation rate must:
A. not change. B. increase. C. decrease. D. either increase or decrease depending on the relative shifts of AD and AS.
Which of the following is key for the Coase Theorem to reach an optimal solution to an externality?
A. Clearly defined property rights B. Both parties having property rights C. No property rights D. A single party with property rights
Regulation that specifies that a firm's profits must be shared with its customers if the profit rises above a target level is called
A) rate of return regulation. B) minimum price regulation. C) earnings sharing regulation. D) average cost pricing.
Explain why the marginal propensity to save and the marginal propensity to consume sum to 1.
What will be an ideal response?