Based on the following information, what is the balance on the current account?
Exports of goods and services = $5 billion
Imports of goods and services= $3 billion
Net income on investments = -$2 billion
Net transfers = -$2 billion
Increase in foreign holdings of assets in the United States = $4 billion
Increase in U.S. holdings of assets in foreign countries = -$1 billion
A) -$2 billion B) $1 billion C) $3 billion D) $4 billion
A
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If unemployment is the most significant problem in the economy, which of the following actions would be an appropriate fiscal policy response?
a. decrease taxes b. decrease government purchases c. decrease the federal deficit d. all of the above
For a monopolistically competitive firm, which of the following is ensured by product differentiation?
a. Long-run profit b. Market power c. Economies of scale d. Increasing returns to scale