Exam 20: Exchange Rates and The Macroeconomy

In the 1990s the United States eliminated its budget deficit and expanded the money supply.This should have led to

Figure 20-1 -Which of the following is correct?

From Table 20-1,compute equilibrium GDP for Macroland.

In Table 20-2,assume that exports rise to $900.How large is the multiplier?

A rise in the domestic interest rate leads to capital

From Table 20-2,what can you conclude about net exports as GDP rises?

When the dollar depreciates,the cost to Americans of foreign goods

If European economies experience a strong economic recovery,U.S.net exports will

International capital flows tend to reduce the impact of fiscal policy.

The U.S.trade deficits of the late 1990s were due primarily to low saving rates.

The saving rate in the United States fell to nearly zero in the early 2000s.One of the contributing factors to this development was the

Figure 20-6 -In Figure 20-6,which of the following will cause a movement from equilibrium at point A to equilibrium at point C?

An increase in the U.S.price level will increase U.S.net exports.

An economic boom in the United States would cause the aggregate demand curve in other countries to shift outward.

A decline in interest rates tends to expand the economy by

The growing federal budget deficit in the 1980s was accompanied by a

A currency depreciation will put upward pressure on the price level.

Figure 20-6 -In Figure 20-6,which of the following will cause a movement from equilibrium at point D to equilibrium at point B?

In an open economy,aggregate supply consists of domestic production

If a country tries to stimulate the economy with fiscal policy,the effects will be exchange rate