Governments prefer to avoid excessive current account surpluses because
A) the returns to domestic savings are more difficult to tax than those on assets abroad.
B) an addition to the home capital stock may increase domestic unemployment and therefore lead to higher national income.
C) foreign investment in one firm may have beneficial technological spillover effects on other foreign producers that the investing firm does not capture.
D) an addition to the home capital stock may reduce domestic unemployment and therefore lead to higher national income.
E) domestic savings increase with more investment abroad.
D
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Gross investment is
A) the wear and tear on private investment. B) the total amount of new private investment purchases. C) what is left over from total new private investment after depreciation. D) the total amount of private investment purchases, whether new or previously existing.
Which of the following correctly lists the three fundamental economic questions?
a. If to produce? Why to produce? When to produce? b. If to produce? What to produce? How to produce? c. Why to produce? What to produce? How to produce? d. What to produce? How to produce? For whom to produce?