An Assumption of the Intertemporal Model That Is Often Not

question 113

Multiple Choice

An assumption of the intertemporal model that is often not met in low-income nations is:

• A) that the economy is always at full employment.
• B) that prices are flexible.
• C) that a nation can borrow or lend any amount in international markets at the prevailing world real rate of interest.
• D) that the government of the nation has a balanced budget.