Suppose That the Economy Is in Equilibrium, with the Government

question 108

Multiple Choice

Suppose that the economy is in equilibrium, with the government budget in surplus and with saving greater than investment.According to the circular-flow model, how do imports relate to exports?  

• A) Imports must exceed exports. 
• B) Imports must be less than exports. 
• C) Imports must equal exports. 
• D) Imports could be greater than or equal to exports.

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Definitions:

Random Walk

A theory in finance suggesting that stock market prices follow an unpredictable path, making it impossible to predict future movements based on past trends.

Input Module

A component of a modular PLC or control system that receives signals from input devices, such as sensors, and converts them into a form that the processor can use.

Output Module

A component in a control system that facilitates the transfer of digital or analog signals from the controller to actuating devices.