By definition, government purchases and taxes are zero for a closed economy
a. True
b. False
Indicate whether the statement is true or false
False
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Under the monetary approach to the exchange rate
A) an interest rate decrease is associated with higher expected inflation and a currency that will be weaker on all future dates. B) an interest rate increase is associated with higher expected deflation and a currency that will be weaker on all future dates. C) an interest rate increase is associated with higher expected inflation and a currency that will be strengthened on all future dates. D) an interest rate increase is associated with higher expected deflation and a currency that will be strengthened on all future dates. E) an interest rate increase is associated with higher expected inflation and a currency that will be weaker on all future dates.
New growth theory suggests that the accumulation of knowledge capital can be slowed because knowledge is both nonrival and nonecludable. How does the federal government intervene in the market to increase the amount of knowledge capital?
A. Public education B. Patents C. Subsidies D. All of the above E. A and B only