In an Open Economy, a Decrease in the Perceived Riskiness

question 21

Multiple Choice

In an open economy, a decrease in the perceived riskiness of domestic assets by foreigners, arising, for example, from an increase in political stability, leads to a(n) _______ in the equilibrium domestic real interest rates and to ____ in the quantity of domestic investment.

• A)increase; an increase
• B)increase; a decrease
• C)increase; no change
• D)decrease; an increase

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Definitions:

Annual Performer

An individual or entity evaluated based on performance over the course of a year, often in terms of productivity, achievements, or contributions.

Desire to Excel

The motivation or drive to surpass standards of excellence and achieve high levels of performance.

Organizational Culture

The set of shared attitudes, values, goals, and practices that characterizes an institution or organization.

Kurt Lewin

A German-American psychologist known for his pioneering work in social psychology, group dynamics, and organizational development, often considered the father of modern social psychology.