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1 – If the real exchange rate in the United States is below the equilibrium level, _____.
–the demand for dollars by foreigners will balance the supply of dollars from Americans
–there will be a shortage of dollars
–the quantity of dollars supplied will exceed the quantity of dollars demanded
–the value of dollar will fall
2 – A decrease in the tax rates in an economy will cause a:
–rightward shift of the aggregate demand curve if the crowding-out effect is equal to the size of the tax multiplier.
–leftward shift of the aggregate demand curve if the crowding-out effect is smaller than the size of the tax multiplier.
–rightward shift of the aggregate demand curve if the crowding-out effect is larger than the size of the tax multiplier.
–leftward shift of the aggregate demand curve if the crowding-out effect is larger than the size of the tax multiplier.
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