33. Which of the following events will increase the domestic real interest rate in an open economy?

Question

33. Which of the following events will increase the domestic real interest rate in an open economy?

A. an increase in domestic saving .

B. a decrease in the domestic saving.

C. a decrease in the perceived riskiness of investing in the domestic economy.

D. an increase in taxes on profits generated by capital .

E. a decrease in the government's budget deficit.

34. The primary cause of trade deficits is:

A. production of poor quality goods.

B. unfair trade restrictions.

C. low rates of national saving.

D. high rates of national saving.

E. cheap foreign labor.

Answer 1

B. a decrease in the domestic saving.

C. low rates of national saving.

Answer 2

33. Which of the following events will increase the domestic real interest rate in an open economy?

correct answer:

B. a decrease in the domestic saving.

34. The primary cause of trade deficits is:

correct answer:

C. low rates of national saving.