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In an Open Economy Under Flexible Exchange Rates and Represented

question 65

Multiple Choice

In an open economy under flexible exchange rates and represented by the IS-LM-IP model,a reduction in government spending will cause a reduction in which of the following?


Definitions:

FOB Shipping Point

A term used in shipping contracts to indicate that the buyer is responsible for the goods and the shipping cost from the moment the goods leave the seller's premises.

Perpetual Inventory System

This method for accounting inventory immediately notes down any purchase or sale through the use of computerized point-of-sale systems and enterprise asset management software.

FOB Shipping Point

A term indicating that the buyer assumes ownership and responsibility for goods at the seller's location, and pays for shipping costs.

FOB Destination

A shipping term indicating that the seller bears the cost and risk of transporting goods until they are delivered to the buyer's location.

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