A debt that rises faster than nominal GDP will impose the following opportunity costs in the future:
a. A permanently higher tax burden.
b. A period of inflation.
c. Reduced government outlays relative to GDP
d. Higher taxes relative to GDP.
e. All of the above.
E
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The basis for trade is comparative advantage, not absolute advantage
Indicate whether the statement is true or false
The supply of foreign exchange to the United States is generated by the desire for foreigners to acquire dollars for all except one of the following reasons. Which is the exception?
a. The United States is considered a safe haven in times of political unrest. b. The dollar has long been accepted as an international medium of exchange. c. Foreigners want to buy U.S. assets. d. U.S. goods have become less attractive to foreigners. e. Foreigners wish to make cash gifts to family in the United States.