Which of the following statements the economic view on Deflation Select one Defl

Question

Which of the following statements the economic view on Deflation Select one Deflation is harmful can cause mass and foreclosures, can linger a deflationary spiral, and thus should Be avoided Deflation is neither good, nor bad and the price level should be allowed to cycle though inflation and deflation as part of the normal business cycle Deflation is good for the economy because as prices fall people can buy more goods which creates jobs Which of the following would be recorded as a debit in the U S current account? Select one United States exports $5 million in corn to Canada American citizens go to sub Saharan Africa to teach reading to young students British financial investments in the United States pay higher dividends The United States buys $1 million in British government bonds If a country is running a capital surplus then the inflow of foreign Select one goods and servers a less than the outflow of goods and services abroad capital is greater than the outflow of the domestic currency abroad goods and services is greater than the outflow of goods and services abroad capital is less than the outflow of the domestic currency abroad

Explanation / Answer

21. (a)

22. (a) Current account records trade in goods and services as well as transfer payments.

23. (b) greater inflow of foreign capital as compared to outflow of domestic currency leads to capital surplus.

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