16. In 2010, the United States had a budget deficit of 1.29 trillion dollars. This will budget deficit ________ the supply of loanable funds and ________ the real interest rate.
(A) increased; lowered
(B) decreased; raised
(C) decreased; lowered
(D) increased; raised

17.Which of the following will lead to a depreciation of the dollar against the British pound?(A) an increase in British demand for U.S. imports (B) an increase in U.S. interest rates(C) a decrease in British demand for U.S. assets (D) a decrease in U.S. demand for British goods

18. China is one of the world's largest exporters. As the world's economies slipped into a worldwide recession in 2008, there will be a ________ China's aggregate demand curve as China's exports ________.(A) rightward shift of; decrease (B) movement upward along; increase(C) leftward shift of; decrease (D) movement upward along; decrease

19. In response to the 2008 recession, New Zealand's Finance Minister Bill English stated that "... the 7 billion New Zealand dollars would be allocated to new infrastructure spending, providing financial aid to workers hit by layoffs as the economy slows and includes tax cuts planned for April." (www.iht.com, 11/26/2008)New Zealand's government expects the policies to shift the ________ but at this point in time the ________ might weaken its ability to affect real GDP.(A) AD curve rightward; recognition lag (B) LAS curve leftward; impact lag(C) SAS curve rightward; law-making lag (D) AD curve rightward; impact lag

20. In November 2008, the Reserve Bank of India (RBI) lowered its "repo" rate, the rate at which it lends to banks, from 8 percent to 7.5 percent. Only two weeks earlier, it had lowered the rate from 9 percent to 8 percent.(The Economist, 11/6/2008)In its attempt to change real GDP, which of following sequences correctly describes the transmission of RBI's monetary policy?i. the real interest rate fallsii. the money supply increasesiii.　bank reserves increaseiv. supply of loanable funds increasesv. aggregate demand increases(A) iii, ii, iv, i, v. (B) ii, i, iii, v, iv. (C) v, i, ii, iv, iii (D) iii, iv, i, iii, v

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