In the wake of the financial crisis of 2007-2009, the debt-to-GDP ratio has risen in many countries around the world. Should the expenditures enabled by this debt be considered government consumption or government investment?
What will be an ideal response?
Probably, government investment. Since a well-functioning financial sector is essential for economic growth, its rescue may be viewed as an investment in the economy's future productivity. Moreover, the avoidance of an economic depression ensures that economic activity will continue and be taxed, enabling payments on interest and principal.
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In which of the following countries would an increase in per capita income likely result in the most improvement to health status of the population? (2006 per capita incomes in PPP dollars shown in parentheses.)
a. Mexico ($13,383) b. New Zealand ($26,068) c. Germany ($32,900) d. United Kingdom ($34,084) e. United States ($44,639)
Which of the following statements best describes possibilities for trade?
a. Many larger national economies around the world, in regions like North America and Western Europe, have much more limited possibilities for trade inside their countries or their immediate regions. b. Many smaller national economies around the world, in regions like Latin America, Africa, the Middle East, and Asia, have much more limited possibilities for trade inside their countries or their immediate regions. c. Many medium national economies around the world, in regions like Latin America, Africa, the Middle East, and Asia, have much more limited possibilities for trade inside their countries or their immediate regions. d. Many smaller national economies around the world, in regions like Eastern Europe, have much more limited possibilities for trade inside their countries or their immediate regions.