Which is the most accurate statement?
A. We are living well beyond our means and we face an imminent financial crisis as foreigners refuse to accept U.S. dollars.
B. We cannot continue running huge current account deficits.
C. We can easily run up larger and larger current account deficits without any serious consequences.
D. Large and growing current account deficits are good for our economy.
B. We cannot continue running huge current account deficits.
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If the reserve requirement is 20 percent and the Fed buys $10,000 worth of Treasury bonds, what is the change in the banks' total reserves?
A) $2,000 B) $20,000 C) $8,000 D) $100,000 E) $10,000
Refer to Figure 3-4. If the price is $15
A) there would be a shortage of 400 units. B) there would be a surplus of 300 units. C) there would be a surplus of 400 units. D) there would be a shortage of 300 units.