Which Two Events Are Most Likely to Be Independent

question 132

Multiple Choice

Which two events are most likely to be independent?

• A) being a senior, and leaving campus for lunch
• B) having a flat tire, and being late for school
• C) having a driver's license, and having blue eyes
• D) having a car accident, and having 3 inches of snow today
• E) getting an A in math, and getting an A in Physics

Understand how government budget deficits impact the open economy, including effects on real interest rates, domestic investment, and trade balance.

Comprehend the relationship between tax credits for investment and shifts in the demand for loanable funds and supply of dollars in the foreign-currency exchange market.

Recognize the effects of capital flight on demand for loanable funds, supply of dollars, and net capital outflows in the foreign-currency exchange market.

Analyze the impact of a government default on its debt on the country's real interest rates and currency valuation in the open-economy macroeconomic model.

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Definitions:

Unit Elastic

A situation in which the percentage change in quantity demanded is equal to the percentage change in price, leading to a unitary elasticity of demand.

Elastic Portion

The segment of a demand curve where a change in price leads to a more than proportional change in the quantity demanded, indicating high price sensitivity.

Linear Demand

A type of demand where there is a constant relationship between the quantity demanded and price, represented by a straight line on a graph.