Exam 32: A Macroeconomic Theory of the Open Economy

When a government reduces its budget deficit, then that country's

In the open-economy macroeconomic model, if the supply of loanable funds shifts right, then

As the interest rate rises, it is possible that net capital outflow could move from a positive to a negative value.

If a government started with a budget deficit and moved to a surplus, domestic investment

Which of the following would make the equilibrium real interest rate decrease and the equilibrium quantity of loanable funds increase?

In the open-economy macroeconomic model, if there is a surplus in the market for foreign-currency exchange, which of the following will move the market to equilibrium?

Which of the following is the most accurate statement?

Other things the same, if the U.S. interest rate falls, then U.S. residents will want to purchase

If the U.S. imposes an import quota on clothing, then the

Over the past two decades the U.S. has persistently had trade deficits.

If the exchange rate falls, U.S. residents pay

What is the source of the supply of dollars in the market for foreign-currency exchange?

In the open-economy macroeconomic model, the supply of loanable funds comes from

What is the source of the supply of loanable funds in the open-economy macroeconomic model?

In an open economy, the demand for loanable funds comes from both domestic investment and net capital outflow.

In the open-economy macroeconomic model, the market for loanable funds identity can be written as

If a country raises its budget deficit, then in the market for foreign-currency exchange

Many U.S. business leaders argue that the current state of U.S. net exports is the result of

If there is a surplus in the U.S. loanable funds market, then the interest rate

Which of the following will not change the U.S. real interest rate?