Assume that the expectation of declining housing prices cause households to reduce their demand for new houses and the financing that accompanies it. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the quantity of real loanable funds per time period and current international transactions in the context of the Three-Sector-Model?
a. The quantity of real loanable funds per time period falls, and current international transactions become more positive (or less negative).
b. The quantity of real loanable funds per time period rises, and current international transactions become more negative (or less positive).
c. The quantity of real loanable funds per time period and current international transactions remain the same.
d. The quantity of real loanable funds per time period rises, and current international transactions remain the same.
e. There is not enough information to determine what happens to these two macroeconomic variables.
.A
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Refer to the figure above, which shows domestic supply and demand. If P1 is equal to P2 (the world price) plus a tariff, then government revenue from the tariff is equal to
A) a + c B) b C) P1 ( Q3 - Q2 ) D) P2 [(Q2 - Q1 ) + (Q4 - Q3 )] E) a + b + c
Why might it be hard for companies to know how much pollution should be cleaned up?
A. Costs are too high so it's not worth all the time and effort to clean up the pollution. B. Many costs of pollution are hard to see or itemize to get an accurate amount of the true cost. C. The government is not clear on the rules and regulations for cleaning up pollution. D. Companies value production and profit too much so they do not want to clean up too much.