For many consumption activities — skiing, for example — the activity becomes more enjoyable as the consumer becomes more experienced
Assuming that "training consumption" is inexpensive relative to "proficient consumption," do such activities make it more or less likely that a borrowing constraint will be binding?
Such activities encourage a shift of consumption into the future. The decrease in current consumption makes a binding borrowing constraint less likely.
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All else being equal, an increase in government spending would shift the ______ line to the ______, causing interest rates to _______ and the trade balance to _______.
A) LM; right; fall; fall B) IS; right; rise; rise C) LM; left; rise; rise D) IS; right; fall; fall
The Fed's discount lending is of three types: ________ is the most common category; ________ is given to a limited number of banks in vacation and agricultural areas; ________ is given to banks that have experienced severe liquidity problems
A) seasonal credit; secondary credit; primary credit B) secondary credit; seasonal credit; primary credit C) primary credit; seasonal credit; secondary credit D) seasonal credit; primary credit; secondary credit