Refer to the graph below, which shows the effect of ________ on ...

[yoroshambo]

Refer to the graph below, which shows the effect of ________ on the home economy.
 
  A) foreign inflation
  B) domestic inflation
  C) foreign deflation
  D) domestic recession
  E) foreign recession

Question 2

Why might a country's savings rate have a high positive correlation to its investment rate?
 
  A) A country's gains from intertemporal trade may have been large.
  B) governments' regulation to avoid inflation
  C) A country's savings rate and investment rate are generally not positively correlated but rather have negative correlation.
  D) governments' regulation to avoid large current account balances
  E) A government has not practiced sufficient fiscal regulation.

[mbcrismon]

Answer to Question 1

A

Answer to Question 2

D