An increase in the government budget deficit ?

A. has no impact on the real interest rate and fails to crowed out investment
B. decreases the real interest rate and crowds out investment
C. None of these answers
D. Increases the real interest rate and crowds out investment

Capital flight ?

A. decreases a country’s net exports and increases its long-run growth path
B. increases a country’s net exports and increases its long-run growth path
C. increases a country’s net exports and decreases its long-run growth path
D. decreases a country’s net exports and decreases its long-run growth path

An increase in Pakistan’s private saving ?

A. increase Pakistan’s net exports and Pakistan’s net capital outflow the same amount
B. Increase Pakistan’s net exports and decrease Pakistan’s net capital outflow
C. decreases Pakistan’s net exports and Pakistan’s net capital outflow the same amount
D. decrease Pakistan’s net exports and increase Pakistan’s net capital outflow

Which of the following statement regarding the loanable funds market is true ?

A. A decrease in the government budget deficit increase the real interest rate
B. An increase in the government budget deficit shifts the supply of loanable funds to the right
C. An increase in private saving shifts the supply of loanable funds to the left
D. An increase in the government budget deficit shifts the supply of loanable funds to the left

Which of the following statements regarding the market for foreign currency exchange is true ?

A. An increase in Pakistan’s net capital outflow increase the supply of rupees and the rupees depreciate
B. An increase in Pakistan’s net capital outflow increase the demand of rupees and the rupees appreciate
C. An increase in Pakistan’s net capital outflow increase the demand of rupees and the rupees depreciate
D. An increase in Pakistan’s net capital outflow increase the supply of rupees and the rupees appreciate

Which of the following statements regarding the market for foreign currency exchange is true ?

A. An increase in Pakistan’s net exports decreases the supply of rupees and the rupees depreciates
B. An increase in Pakistan’s net exports increase the demand for rupees and the rupees appreciates
C. An increase in Pakistan’s net exports increases the Supply of rupees and the rupees depreciates
D. An increase in Pakistan’s net exports decrease the demand for rupees and the rupees appreciates

Which of the following statements regarding the loanable funds market is not true ?

A. A decrease in a country’s net capital outflow shifts the demand for loanable funds to the left
B. An increase in domestic investment shifts the demand for loanable funds to the right
C. An increase in a country’s net capital outflow shifts the supply of loanable funds to the left
D. An increase in a country’s net capital outflow raises its real interest rate

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