The demand for the services of labor ________ a derived demand and the demand for the services of land ________ a derived demand

The U.S. balance of payments status may improve when

A) the inflation rate increases in the United States relative to other countries. B) political instability in other countries increases. C) the world demand for U.S. products falls. D) the American government increases its spending on foreign aid.

Assume that foreign capital flows into a nation rise due to expected increases in stock market appreciation. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the GDP Price Index and current international transactions balance in the context of the Three-Sector-Model? a. The GDP Price Index falls and current international transactions

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