The United States has net exports of -$350 billion and the private sector balance is -$400 billion. What is the government sector balance?
What will be an ideal response?
The sum of the private sector balance plus the government sector balance equals net exports. Therefore -$350 billion = -$400 billion + government sector balance, so the government sector balance is $50 billion.
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Suppose the economy experiences a recessionary gap. Expansionary monetary policy will
A) increase interest rates and increase exchange rates. B) increase interest rates and decrease exchange rates. C) decrease interest rates and increase exchange rates. D) decrease interest rates and decrease exchange rates.
Which of the following is false? a. Property rights provide the rules of the economic game
b. Well defined property rights give individuals the incentive to use their property efficiently. c. Owners with property rights have an incentive to conserve their property. d. Owners have no incentive to care what values others place on what they own.