Countercyclical policy:
What will be an ideal response?
: fiscal policy in which taxes are lowered and expenditure is raised when the economy is weak, and the opposite occurs when the economy is strong
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Other things remaining the same, a ________ in the real interest rate ________ the quantity of saving supplied and ________ the quantity of loanable funds supplied
A) rise; increases; decreases B) fall; increases; decreases C) fall; increases; increases D) fall; decreases; increases E) rise; increases; increases
Which of the following transactions represents a deficit in the current account of the US balance of payments?
a) the moscow capital investment corporation makes a loan to a US firm b) a US subsidiary exports raw materials to its french parent company c) US firms and individuals receive dividends on US investments in latin america d) US tourists in great britain purchase pounds sterling e) foreigners purchase US securities