Suppose the government of a large open economy reduces its spending, so that national saving increases. The result is
A) a decrease in the foreign country's net exports.
B) an increase in the real interest rate.
C) an increase in the foreign country's net exports.
D) a decrease in investment.
A
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If the CPI this year is 220 and was 200 in last year, the annual inflation rate between the two years is
A) 5 percent. B) 10 percent. C) 20 percent. D) 2 percent.
Domestic firms operating abroad may find it economically beneficial to adopt environment-friendly standards because
A) foreign nations may be upset if firms do not use the environment-friendly technology. B) the least-cost strategy usually involves the adoption of one set of environment-friendly technology rather than multiple standards. C) they may be forced to replace the old technology whenever the foreign country experiences positive economic development. D) their environment-unfriendly technology may be replaced by foreign-based technology. E) Only C and D are correct.