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:

Death Benefit

A sum of money paid to a beneficiary upon the death of the insured person.

Breach Of Warranty

The violation of a promise, claim, or guarantee about the condition or quality of a product or service.

Insurer's Duty

The obligations and standards of conduct expected from an insurance company, including acting in good faith and handling claims fairly.

Innocent Misrepresentation

A false statement made without malice or knowledge of its falsity, often leading to a misunderstanding in a contract or agreement.