Exam 32: A Macroeconomic Theory of the Open Economy

What effect do protectionist policies have on the trade deficit?

Which of the following would not be a consequence of an increase in the U.S.government budget deficit?

When the government increases the government budget deficit,national saving decreases.

In the open-economy macroeconomic model we focus on the determination of GDP and the price level.

If the U.S.put an import quota on vacuum cleaners,it would

The open-economy macroeconomic model examines the determination of

Which of the following increases if the U.S.imposes an import quota on computer components?

Figure 32-2 -Refer to Figure 32-2.Domestic investment plus net capital outflow is represented by the

Figure 32-1 -Refer to Figure 32-1.In the Figure shown,if the real interest rate is 3 percent,the quantity of loanable funds demanded is

An increase in the real interest rate

In the open-economy macroeconomic model,if a country's interest rate increases,its net capital outflow

When a country experiences capital flight,the interest rate

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

The value of net exports equals the value of

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

At the equilibrium interest rate in the open economy macroeconomic model,the equilibrium quantity of loanable funds equals

If net exports are positive,then

In the market for foreign-currency exchange in the open economy macroeconomic model,the amount of net capital outflow represents the quantity of dollars

Figure 32-2 -Refer to Figure 32-2.The curve in panel b shows that as the interest rate rises,

The supply of loanable funds comes from