The study of aggregate economic behavior is referred to as:

Accounting profits are total revenues minus

A) all relevant opportunity costs. B) explicit and implicit costs. C) explicit costs and all other relevant opportunity costs. D) explicit costs.

Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the real risk-free interest rate and current international transactions in the context of the Three-Sector-Model?

a. The real risk-free interest rate falls, and current international transactions become more negative (or less positive). b. The real risk-free interest rate rises, and current international transactions become more negative (or less positive). c. The real risk-free interest rate and current international transactions remain the same. d. The real risk-free interest rate rises, and current international transactions remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.