A country's imports of goods minus its exports of goods is reported in the goods balance.

A country's imports of goods minus its exports of goods is reported in the goods balance.
 a. True
  b. False
  Indicate whether the statement is true or false

QUESTION 2

In the aggregate expenditures model, equilibrium occurs if:
 a. aggregate expenditures (AE) are greater than GDP.
  b. aggregate expenditures (AE) are less than GDP.
  c. there is no unplanned inventory depletion or accumulation.
  d. consumption equals investment.

QUESTION 3

Are outstanding credit card balances counted as part of the money supply?
 a. Yes; they are used to purchase things, and therefore, they are included in the money supply figures.
  b. No; money is an asset, while the credit card balances are a liability. Thus, they are not included in the money supply figures.
  c. Partly; credit card balances of 100 or less are included in the M1 money supply, but the money supply figures do not include balances in excess of 100.
  d. Partly; credit card balances are included in the M1 money supply, but not the M2 money supply.

QUESTION 4

The current account balance tabulates the value of a country's exports of goods and services minus the value of its imports of goods and services.
 a. True
  b. False
  Indicate whether the statement is true or false

QUESTION 5

Using C to represent consumption, I to represent investment, G to represent government spending, S to represent saving, X to represent exports, and M to represent imports, aggregate expenditures can be represented by:
 a. C + I + G + (X + M).
  b. (C  S) + G + (X  M).
  c. C + I + G + (X  M).
  d. C + I + G + (X  M)  S.

QUESTION 6

Fiat money is money:
 a. accepted by law regardless of its intrinsic value.
  b. that is not included as part of the M1 money supply.
  c. that is backed by gold or silver held on reserve by the government.
  d. such as coins that are made from metal.

QUESTION 7

A country's balance on current account will always equal its balance on capital account.
 a. True
  b. False
  Indicate whether the statement is true or false