If in the Long Run, Imports Are Paid for by Exports

question 153

Multiple Choice

If in the long run, imports are paid for by exports, then

• A) any restriction of imports ultimately reduces exports.
• B) any restriction of imports ultimately expands exports.
• C) any restriction of imports has no impact on exports.
• D) any restriction of exports has no impact on imports.

Differentiate classical economic theories from Keynesian economics concerning market equilibrium, employment, and government intervention.

Identify factors that cause shifts in aggregate demand and supply and their effects on the economy.

Understand the assertions of classical economists regarding market adjustments, full employment, and inflation.

Analyze the role of government policy in adjusting aggregate demand to influence economic outcomes.

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Definitions:

Capital Account

The capital account records the exchanges of financial assets and liabilities between a country and the rest of the world, including direct investment and loans.

Current Account

A component of a country's balance of payments that includes transactions in goods, services, primary income, and secondary income flows between domestic and foreign entities.

Demand

The quantity of a good or service that consumers are willing and able to purchase at different prices.

British Pounds

The currency of the United Kingdom, symbolized as GBP, and commonly referred to as the pound sterling.