答案如下
Foreign investment that is attracted by higher interest rates due to planned deficits:
A) is an automatic economic stabilizer.
B) shifts the crowding out effect from restricted investment demand to less demand for U.S. exports.
C) supports the supply side theory.
D) enhances the crowding out effect.
Your answer: B was correct!
When the government runs a deficit to stimulate the economy, the higher interest rates that result tend to crowd businesses out of the capital markets. However, assuming the higher interest rates attract foreign investment, the resulting increase in the value of the dollar will reduce U.S. exports.
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发表于 2006-3-24 15:18
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