In a Small Open Economy, When the Government Reduces National

question 46

Multiple Choice

In a small open economy, when the government reduces national saving, the equilibrium real exchange rate:

• A) rises and net exports fall.
• B) rises and net exports rise.
• C) falls and net exports fall.
• D) falls and net exports rise.

---

Definitions:

Tympanometry

a diagnostic test measuring the movement of the eardrum in response to changes in air pressure, used to assess middle ear function.

Middle Ear

The section of the ear located between the eardrum and the oval window, containing three small bones that transmit sound vibrations.

Partial Color Blindness

A condition where an individual has difficulty distinguishing between certain colors, as opposed to complete inability.

Protanopia

A type of color blindness characterized by the inability to distinguish between colors within the green-red spectrum due to the absence of red photoreceptors in the eyes.