Policy coordination is difficult because each country
A) prefers to be the one to increase demand.
B) prefers to be the one to appreciate its currency.
C) prefers that other countries increase their demand.
D) prefers to be the one to increase taxes.
E) prefers that other countries increase taxes.
C
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Refer to Figure 5-3. In the absence of any government intervention, the private market
A) underproduces by Qo - Qm units. B) underproduces by Qn - Qm units. C) overproduces by Qn - Qm units. D) overproduces by Qo - Qm units.
The classic loser from an unanticipated inflation is
A) the borrower who pays less nominal interest than expected. B) the borrower who pays more nominal interest than expected. C) the saver who earns less real interest than expected. D) the saver who earns more real interest than expected, and so should have saved more.