Australia ________ Concerned with Being a Net Borrower If Australia

question 44

Multiple Choice

Australia ________ concerned with being a net borrower if Australia is using all of the borrowed funds to ________.

• A)should be; finance investment
• B)should not be; finance consumption
• C)should not be; finance imports
• D)should be; pay interest to service debt

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Definitions:

Hyperinflation

An extremely high and typically accelerating rate of inflation, often exceeding 50% per month.

Long-run Equilibrium

A state in an economy or market where all factors of production are fully utilized, and all prices and quantities have adjusted so that aggregate supply equals aggregate demand.

Inflation Expectations

Consumers' and investors' predictions about future inflation rates, which can influence economic decisions and actual inflation through their impact on wages, prices, and interest rates.

Short-run Phillips Curve

A graphical representation showing an inverse relationship between the rate of inflation and the rate of unemployment in an economy over the short-term.