In the circular flow model,
a. money flows from the firms to the households through the product market.
b. money flows from the households to the firms through the product market.
c. money flows from the households to the firms through the resource market.
d. money flows from the households to the firms through both the product market and the resource market.
e. resources flow to the households from the firms through the product market.
b
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The variable used to measure economic growth is
A) the growth of the money supply. B) the trade surplus. C) the growth in per capita real GDP. D) the number of new jobs created.
In each of the following scenarios, explain why the euro will appreciate or depreciate in a system of floating exchange rates. A) A recession in Germany cuts German purchases of American goods. B) American investors are attracted by prospects for profit on the Frankfurt Stock Exchange. C) Interest rates on government bonds rise in the U.S. but remain stable in Germany