In a closed economy, the total quantity of goods demanded equals the sum of
A) consumption spending, investment spending, and government spending.
B) consumption spending, national saving, and taxes.
C) consumption spending, government spending, and taxes.
D) investment spending, national saving, and taxes.
A
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Tele-Com, Inc, the nation's largest cable TV company, tested the effect of a price reduction for the Disney Channel. It lowered prices from $10.75 to $7.95 and found that the number of customers more than doubled. This means the
a. demand curve for the Disney Channel shifted to the right. b. supply curve of the Disney Channel shifted to the left. c. demand for the Disney Channel is elastic in this price range. d. demand for the Disney Channel is inelastic in this price range.
The strongest argument in favor of fixed exchange rates is
A. that floating exchange rates are often very volatile, disrupting international trade. B. that a fixed exchange rate allows unrestricted flow of financial capital from and into a country. C. the country's ability to use independent monetary policy to pursue internal balance. D. the ease of defending fixed exchange rates during speculative attacks.