Which of the following statements is true?
A) Arithmetic or geometric growth rates gives similar answers for long periods.
B) Using either arithmetic or geometric average to compute average growth rates gives similar answers for short periods.
C) Geometric average of growth rate ignores the exponential nature of growth.
D) Arithmetic calculation of growth rate considers the exponential nature of growth.
B
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When a depreciation in the nation's real effective exchange rate initially lowers the trade balance and then increases it, economists refer to the phenomenon as:
a. the K-curve effect. b. the J-curve effect. c. the real balances effect. d. the marginal propensity to import.
A lender of last resort
A) makes loans when no one else will. B) makes loans without regard for risk. C) is a firm that is forced to make loans for its own survival. D) Both A and B. E) None of the above.