If a country's currency is ________, then the country can borrow from other countries almost without limit by issuing assets that will be held by the central banks of other countries.
A. golden
B. pegged
C. floating
D. a reserve currency
Answer: D
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A constant rate of U.S. economic growth over a given period of years would involve
A) adding the same amount of real dollars to real GDP per capita each year. B) compounding the percentage increase in real GDP per capita over the years. C) adding the same amount of nominal dollars to real GDP per capita each year. D) None of the above are correct.
When interest rates are artificially lowered through expansionary monetary policy,
A) longer-term investment projects appear to be more profitable. B) production of capital goods increases. C) the economy experiences an unsustainable boom phase. D) the economy will likely fall into a recession in the longer run. E) all of the above tend to occur.
To a bank, reserves are classified as
A) an asset. B) a liability. C) equity D) a liability or an asset
Financial markets are a key institution of growth because:
A. without them there would be no incentive to invest. B. they move funds from those who save to those who invest. C. they allow people to plan better for retirement. D. without them people would not save.