Refer to the table below. If the profit for each unit of paper product is $2 and the profit for each unit of lumber is $5, the profit-maximizing quantity of lumber and paper products is located between which to points on Big Oaks' production possibilities frontier?

If the United States donates footballs to Japan, how is the transaction recorded on the U.S. balance of payments accounts?

A) Decline in merchandise trade; increase in financial account B) Decline in financial account; increase in merchandise trade C) Decline in net unilateral transfers; increase in merchandise trade D) Decline in merchandise trade; increase in net unilateral transfers

Assume that the expectation of declining housing prices cause households to reduce their demand for new houses and the financing that accompanies it. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the real risk-free interest rate and net nonreserve-related international borrowing/lending in the context of the Three-Sector-Model?

a. The real risk-free interest rate rises, and net nonreserve-related international borrowing/lending becomes more negative (or less positive). b. There is not enough information to determine what happens to these two macroeconomic variables. c. The real risk-free interest rate falls, and net nonreserve-related international borrowing/lending becomes more positive (or less negative). d. The real risk-free interest rate falls, and net nonreserve-related international borrowing/lending remains the same. e. The real risk-free interest rate falls, and net nonreserve-related international borrowing/lending becomes more negative (or less positive).