A balance of payments crisis is best described as
A) a sharp change in interest rates sparked by a change in expectations about the level of imports.
B) a sharp change in foreign reserves sparked by a change in expectations about the future exchange rate.
C) a sharp change in interest rates sparked by a change in expectations about the level of exports.
D) a sharp change in foreign reserves sparked by a change in expectations about the level of imports.
E) a sharp change in foreign reserves sparked by a change in expectations about domestic production.
B
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The immediate, direct effect of someone's cashing a check at a commercial bank is
A) a decrease in the stock of money (M1). B) an increase in the stock of money (M1). C) no change in the stock of money. D) unknown until the check casher spends the currency withdrawn from the bank.
Suppose you are an advisor to the Business Cycle Dating Committee. You are asked to look at macroeconomic data to evaluate whether the economy has entered a recession this year
Which data do you look at? How does the economy behave at the onset of a recession?