According to the traditional interest-rate channel, expansionary monetary policy lowers the real interest rate, thereby raising expenditure on

In the long run, the economic profit of a firm in a perfectly competitive market

A) will be above zero. B) will be below zero. C) will equal zero. D) can be above, below, or equal to zero.

The invocation of beggar-thy-neighbor arguments with respect to industrial policies

A) strengthens the argument for subsidies. B) makes sense if the international Keynesian multipliers exceed unity. C) applies only to rich countries most of whose trade partners are very poor countries. D) weakens the argument for subsidies. E) does not apply to rich countries who can influence relative world prices.