Author Question: Why is the multiplier for contractionary fiscal policy smaller in an open economy? A) ... (Read 107 times)

Starlight

  • Hero Member
  • *****
  • Posts: 567
Why is the multiplier for contractionary fiscal policy smaller in an open economy?
 
  A) Contractionary fiscal policy reduces the deficit, which raises the interest rate, which raises the foreign exchange value of the dollar, which increases net exports.
  B) Contractionary fiscal policy increases the deficit, which raises the interest rate, which reduces the foreign exchange value of the dollar, which increases net exports.
  C) Contractionary fiscal policy reduces the deficit, which reduces the interest rate, which reduces the foreign exchange value of the dollar, which decreases net exports.
  D) Contractionary fiscal policy reduces the deficit, which reduces the interest rate, which reduces the foreign exchange value of the dollar, which increases net exports.

Question 2

Georgia's great uncle gave her a 5,000 savings bond as a wedding gift. The bond pays 5,000 at maturity, which is in 10 years. If the interest rate is 4, the bond has a present value of  3,377.82.
 
  Indicate whether the statement is true or false



jordangronback

  • Sr. Member
  • ****
  • Posts: 339
Answer to Question 1

D

Answer to Question 2

TRUE



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question


 

Did you know?

Dogs have been used in studies to detect various cancers in human subjects. They have been trained to sniff breath samples from humans that were collected by having them breathe into special tubes. These people included 55 lung cancer patients, 31 breast cancer patients, and 83 cancer-free patients. The dogs detected 54 of the 55 lung cancer patients as having cancer, detected 28 of the 31 breast cancer patients, and gave only three false-positive results (detecting cancer in people who didn't have it).

Did you know?

Most fungi that pathogenically affect humans live in soil. If a person is not healthy, has an open wound, or is immunocompromised, a fungal infection can be very aggressive.

Did you know?

According to the American College of Allergy, Asthma & Immunology, more than 50 million Americans have some kind of food allergy. Food allergies affect between 4 and 6% of children, and 4% of adults, according to the CDC. The most common food allergies include shellfish, peanuts, walnuts, fish, eggs, milk, and soy.

Did you know?

Sildenafil (Viagra®) has two actions that may be of consequence in patients with heart disease. It can lower the blood pressure, and it can interact with nitrates. It should never be used in patients who are taking nitrates.

Did you know?

Adult head lice are gray, about ? inch long, and often have a tiny dot on their backs. A female can lay between 50 and 150 eggs within the several weeks that she is alive. They feed on human blood.

For a complete list of videos, visit our video library