review_exam2

review_exam2 - ECON 304 Exam 2 Practice questions (covers...

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ECON 304 Exam 2 Practice questions (covers Ch. 4.3, 5, 7, 8) Note: there are no current events questions here , but you will have a few true/false current events questions so remember to review the current events we discussed in class! 1. A small open economy decreases its investment demand. This causes the world real interest rate to ________ and the country's current account balance to ________. a. rise; rise b. remain unchanged; fall c. rise; fall d. remain unchanged; rise 2. A temporary decrease in government purchases would cause a. a rightward shift in the saving curve and a rightward shift in the investment curve b. a rightward shift in the saving curve and a leftward shift in the investment curve c. a rightward shift in the saving curve, but no shift in the investment curve d. no shift in the saving curve, but a leftward shift in the investment curve 3. A small open economy reduces its desired saving. This causes the world real interest rate to ________ and the country's current account balance to ________. a.
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review_exam2 - ECON 304 Exam 2 Practice questions (covers...

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