The best example of a command socialist economy is:

Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the GDP Price Index and current international transactions in the context of the Three-Sector-Model?

a. The GDP Price Index falls, and current international transactions become more negative (or less positive). b. The GDP Price Index rises, and current international transactions become more negative (or less positive). c. The GDP Price Index and current international transactions remain the same. d. The GDP Price Index rises, and current international transactions remains the same. e. There is not enough information to determine what happens to these two macroeconomic variables.

When the housing bubble occurred it can be attributed to all of the following except:

A. people expected housing prices to continue to rise. B. it became easier to leverage more of a home's value, putting buyers more into debt. C. the seller of the mortgage had lost incentive to properly assess the risk. D. homeowners lack of confidence in the institutions who made the loan to them.