The typical tax-haven subsidiary owns the common stock of its related operating foreign subsidiaries.

If a firm operates in a perfectly competitive market, then

A) all firms will advertise. B) no firms will advertise. C) the market leader will advertise. D) new firms will advertise.

Suppose the economy was in equilibrium, and the national government increased spending by $200 billion. Monetarist theory would predict that the nation's:

a. Real risk-free interest rate will rise causing real GDP to fall. b. Real risk-free interest rate will rise causing the monetary base, and therefore, the money supply to rise. c. Real risk-free interest rate will remain unchanged, but the money multiplier will rise. d. Real risk-free interest rate will fall causing real GDP to rise. e. Real risk-free interest rate will rise but real GDP will remain the same.