In fiscal year 2001, the U.S. government ran a surplus of about $127 billion. In fiscal year 2002, the government ran a deficit of $159 billion. Other things the same, this change would be expected to have
a. decreased interest rates and investment.
b. decreased interest rates and increased investment.
c. increased interest rates and investment.
d. increased interest rates and decreased investment.
d
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If a bottle of fine French wine costs US$250 in the U.S., 2500 rand in South Africa, there are no transaction costs, and the exchange rate is 20 rand/US$, then
A) there is an arbitrage opportunity by buying the wine in the U.S., and selling it in South Africa and the price in South Africa will drop. B) there is an arbitrage opportunity by buying the wine in South Africa., and selling it in the U.S. and the price in the U.S. will drop. C) here is an arbitrage opportunity by buying the wine in South Africa., and selling it in the U.S. and the price in the U.S. will rise. D) there is no arbitrage opportunity.
Rank the price elasticities of the following goods in descending order (from highest to lowest)
a. chewing gum, sport shirt, 4-bedroom house b. 4-bedroom house, chewing gum, sport shirt c. chewing gum, 4-bedroom house, sport shirt d. 4-bedroom house, sport shirt, chewing gum e. sport shirt, chewing gum, 4-bedroom house