In the Absence of International Capital Flows, the Equilibrium Interest

question 97

Multiple Choice

In the absence of international capital flows, the equilibrium interest rate in the U.S. market for loanable funds is 3%, while in Germany it is 7%. International borrowing and lending between the United States and Germany could result in a common interest rate of _____% and _____.

• A) 5; capital inflows to the United States matching the capital outflows from Germany
• B) 3; massive capital inflows from Germany to the United States
• C) 4; capital outflows from the United States matching the capital inflows to Germany
• D) 7; massive capital inflows from the United States to Germany

Understand how to create effective and clear graphics without adding unnecessary elements that may confuse the reader.

Recognize the appropriate graphic type to represent specific types of data or information.

Appreciate the significance of cultural sensitivity when creating and using graphics in order to communicate effectively with multicultural audiences.

Identify methods for organizing and presenting data within tables to enhance readability and prevent misinterpretation.

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Definitions:

Scientific Method

Systematic method of obtaining and evaluating information relevant to a problem.

Variable

Measurable factor or characteristic that can vary within an individual, between individuals, or both.

Dependent Variable

In experimental and statistical research, the variable being tested and measured, which is expected to change as a result of manipulations to the independent variable.

Hypothesis

Testable statement about two or more variables and the relationship between them.