Question : 81) The concept of “national saving” refers to the A) : 1384509

81) The concept of “national saving” refers to the

A) difference between private saving and government saving.

B) sum of private saving and government saving.

C) money supply measure, M3.

D) difference between the two measurements of the money supply, M3 – M2.

E) total saving of the private sector.

82) What economists call “government saving” is the same as the

A) government’s actual budget surplus.

B) difference between household saving and business saving.

C) difference between household saving and private saving.

D) dollar amount of bonds that the government holds at any given time.

E) sum of the budget surplus and national saving.

83) An illustration of “crowding out” in macroeconomics is best provided by

A) a decrease in government subsidies for low-cost housing causes an increase in private spending on housing.

B) a decrease in the money supply decreases nominal GDP.

C) an increase in tariffs causes a decrease in imports.

D) an increase in the money supply crowds out the issuance of privately held debt.

E) a fiscal expansion raises interest rates and thereby lowers private investment.

84) Consider a closed-economy AD/AS macro model. A policy-induced increase in the government’s budget deficit is most likely to crowd-out private investment if

A) interest rates decrease sharply as a result of the deficit.

B) interest rates rise sharply as a result of the deficit.

C) rising income increases the volume of saving and interest rates rise very little.

D) there is a very large output gap.

E) consumers reduce consumption as a result of the deficit.

85) Consider an open-economy AD/AS macro model. An expansionary fiscal policy will generally increase the government’s budget ________ and also tends to ________ and thus ________ net exports.

A) deficit; appreciate the currency; decrease

B) surplus; depreciate the currency; increase

C) deficit; appreciate the currency; increase

D) surplus; appreciate the currency; decrease

E) deficit; depreciate the currency; decrease

86) Consider a closed-economy AD/AS macro model. An expansionary fiscal policy will generally increase the government’s budget ________ and also tends to ________ and thus ________ investment.

A) deficit; raise interest rates; decrease

B) surplus; reduce interest rates; increase

C) deficit; raise interest rates; increase

D) surplus; reduce interest rates; decrease

E) deficit; reduce interest rates; increase

87) Consider a closed-economy AD/AS model. If an increase in the government’s budget deficit drives up market interest rates,

A) credit will become less expensive.

B) nothing — government borrowing cannot push up interest rates.

C) private expenditure will likely increase.

D) some private investment expenditure will probably be crowded out.

E) the money supply will increase.

88) In an open economy like Canada’s, a policy-induced increase in the government’s budget deficit tends to

A) attract foreign capital and reduce interest rates.

B) crowd out public consumption.

C) crowd out net exports and reduce interest rates.

D) attract foreign capital and crowd out net exports.

E) depreciate the domestic currency.

89) In an open economy like Canada’s, a fiscal expansion by the government tends to

A) appreciate the currency.

B) attract foreign capital and encourage increased investment.

C) crowd out net exports and encourage private investment.

D) attract foreign capital, appreciate the currency, and crowd out net exports.

E) attract foreign capital, depreciate the currency, and crowd out net exports.

90) In an open economy with internationally mobile financial capital, we would expect a policy-induced increase in the government’s budget deficit to crowd out

A) consumption more than investment.

B) consumption more than net exports.

C) investment more than net exports.

D) government purchases more than net exports.

E) net exports more than investment.