A U.S. grocery chain borrows money to buy a warehouse in Ohio and another in Italy. Borrowing for which warehouse(s) is included in the demand for loanable funds in the U.S.?
a. both the one in Ohio and the one in Italy
b. only the one in Ohio
c. only the one in Italy
d. neither the one in Ohio nor the one in Italy
a
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Which of the following might cause the real value of money to rise in an economy?
a) The government prints $1 million in new bills to finance its spending. b) The average price of food items rise by 20%. c) The price of houses and apartment rentals falls by 30%. d) Other countries in the world demand less of this money.
Suppose the price level is fixed, the MPC is .5, and the GDP gap is a negative $80 billion. To achieve full-employment output (exactly), government should:
A. increase government expenditures by $80 billion. B. reduce government expenditures by $40 billion. C. reduce taxes by $40 billion. D. reduce taxes by $80 billion.