Spending VCU4 on real-world goods and services causes the nation's:
a. Monetary base to fall.
b. M2 money supply to fall.
c. M2 money multiplier to remain the same.
d. M2 money supply to rise.
Question 2 - Assume that foreign capital flows from a nation increase due to political uncertainly and increased risk. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the GDP Price Index and net nonreserve international borrowing/lending balance in the context of the Three-Sector-Model?
a. The GDP Price Index falls and net nonreserve international borrowing/lending balance becomes more negative (or less positive).
b. The GDP Price Index rises and net nonreserve international borrowing/lending balance becomes more negative (or less positive).
c. The GDP Price Index falls and net nonreserve international borrowing/lending balance becomes more positive (or less negative).
d. The GDP Price Index and net nonreserve international borrowing/lending balance remain the same.
e. There is not enough information to determine what happens to these two macroeconomic variables.
Question 3 - The major source of financing in the Anglo Saxon model is:
a. Securities markets
b. Secondary market financing
c. The sale of treasury bonds
d. Bank financing
e. None of the above
Question 4 - Spending VCU4 on real-world goods and services causes the nation's:
a. Monetary base to remain the same.
b. M2 money supply to fall.
c. M2 money multiplier to fall.
d. M2 money supply to rise.
Question 5 - Assume that foreign capital flows from a nation increase due to political uncertainly and increased risk. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the GDP Price Index and monetary base in the context of the Three-Sector-Model?
a. The GDP Price Index rises and monetary base rises.
b. The GDP Price Index rises and monetary base falls.
c. The GDP Price Index and monetary base fall.
d. The GDP Price Index and monetary base remain the same.
e. There is not enough information to determine what happens to these two macroeconomic variables.
Question 6 - Prior to 1877 business could not be regulated by the states because of:
a. lack of public support
b. the fifth amendment
c. the 10th amendment
d. the due process clause
e. all of the above
Question 7 - Spending VCU4 on real-world goods and services causes the nation's:
a. Monetary base to fall.
b. M2 money supply to fall.
c. M2 money multiplier to fall.
d. Monetary base to remain the same.
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