In a Large Open Economy ________

question 47

Multiple Choice

In a large open economy ________.

• A)the effect of shifts in saving and investment on the trade balance are in the same direction as in a closed economy
• B)the effect of shifts in saving and investment on net capital flows are in the same direction as in a closed economy
• C)the effect of shifts in saving and investment on the domestic real interest rate and the actual levels of saving and investment are in the same direction as in a closed economy
• D)all of the above
• E)none of the above

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Definitions:

Intangible Capital

Non-physical assets possessed by a company, such as intellectual property, brand names, and organizational knowledge that contribute to the company's value.

Tangible Capital

Physical assets owned by a firm that are used in the production process, such as buildings and machinery.

Goodwill

An intangible asset that represents the value of a company's brand name, customer relationships, employee relations, and other non-physical assets.

Human Capital

The stock of habits, knowledge, social and personality attributes, including creativity, embodied in the ability to perform labor so as to produce economic value.