Assume the government reduces government spending. What is the first round effect on the components of the balance of payments (assume low international capital mobility and fixed exchange rates; also assume that before the government action all the components were 0)?
a. Current international transactions balance and reserves account become positive; net nonreserve international
borrowing/lending balance becomes negative.
b. Current international transactions balance becomes positive; net nonreserve international borrowing/lending balance and reserves account become negative.
c. Net nonreserve international borrowing/lending balance becomes positive; current international transactions balance and reserves account becomes negative.
d. Net nonreserve international borrowing/lending balance and reserves account become positive; current international transactions balance becomes negative.
e. Reserves account becomes positive; current international transactions balance and net nonreserve international borrowing/lending balance become negative.
.B
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Reduction or elimination of dividend taxes is designed, in part, to
A) reduce the double taxation burden on individuals. B) make rich people richer. C) reduce inefficiencies in the production process. D) increase corporate tax levels.
"Offshoring" refers to:
A. importing goods, services, and resources. B. stashing money in offshore accounts for the purpose of avoiding taxes. C. shifting work overseas that was previously done domestically. D. exporting key resources.