Exam 14: A Macroeconomic Theory of the Open Economy

In 2002, the United States imposed restrictions on the importation of steel into the United States. The open-economy macroeconomic model shows that such a policy would

When the real exchange rate for the dollar appreciates, U.S. goods become

Figure 14-1 -Refer to Figure 14-1. In the Figure shown, if the real interest rate is 6 percent, there will be pressure for

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

U.S. corporation Well's Petroleum borrows money to build an oil well in Texas and to build another in Venezuela. Borrowing for which well is included in the demand for loanable funds in the U.S.?

The primary focus of the open-economy macroeconomic model is the determination of GDP and the price level.

How are the identities S = NCO + I and NCO = NX related to the foreign currency exchange market and the loanable funds market?

If a country experiences capital flight, which of the following lists only curves that shift right?

Suppose the real exchange rate is such that the market for foreign-currency exchange has a surplus. This surplus will lead to

Other things the same, in the open-economy macroeconomic model, which of the following would make India's net capital outflow increase?

If U.S. residents want to buy more foreign bonds, then in the market for foreign-currency exchange the exchange rate

In the open-economy macroeconomic model, equilibrium in the market for foreign-currency exchange is determined by the equality between the supply of dollars which comes from

If at a given real interest rate desired national saving were $50 billion, domestic investment were $40 billion, and net capital outflow were $20 billion, then at that real interest rate in the loanable funds market there would be a

If a country institutes policies that lead domestic firms to desire more capital stock

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

Which of the following would shift the supply of dollars in the market for foreign-currency exchange of the open-economy macroeconomic model to the left?

Which of the following is a consistent response to an increase in the U.S. real interest rate?

If the quantity of loanable funds supplied is greater than the quantity demanded, then

If the U.S. government went from a budget deficit to a budget surplus then

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