In a Two-Good,two-Period Model with Trade,an Increase in the Capital

question 33

Multiple Choice

In a two-good,two-period model with trade,an increase in the capital stock

• A) can eliminate the current account deficit in the long run.
• B) increases domestic output and decreases consumption.
• C) decreases domestic output and increases the current account surplus.
• D) decreases domestic output and decreases the current account surplus.
• E) has no impact on domestic consumption.

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Definitions:

Open Innovation

A business model that encourages sharing ideas and innovations with others outside the organization to accelerate development and leverage external expertise.

Extrinsic Motivation

Motivation that stems from the work environment external to the task; it is usually applied by others.

Innovation

The process of creating, developing, and implementing new ideas, products, or methods to improve or replace existing ones.

Extrinsic Rewards

Benefits or incentives given to an individual that are external to the task being performed, such as money, praise, or awards.