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omeli [17]
2 years ago
9

Holding other factors constant, legislation to cut taxes in an open economy will: a. increase national saving and lead to a trad

e surplus. b. increase national saving and lead to a trade deficit. c. reduce national saving and lead to a trade surplus. d. reduce national saving and lead to a trade deficit.
Business
1 answer:
barxatty [35]2 years ago
6 0

The correct option is (d); reduce national saving and lead to a trade deficit.

<h3>What is trade deficit?</h3>

When a nation purchases more than it exports, a trade deficit results. Although very big deficits can hurt the economy, a trade deficit is neither fundamentally fully positive nor harmful.

Some key features of trade deficit are-

  • When a nation purchases more than it exports, a trade deficit results.
  • A nation with a trade deficit, also referred to as a negative trade balance, has spent more money than it has made in its foreign trade with other nations.
  • The amount of imports and exports a nation makes can affect that nation's GDP, currency value, rate of inflation, and interest rates. The amount of imports and the size of the trade deficit can both hurt a nation's currency.
  • A trade imbalance results when domestic consumers purchase more foreign goods than domestic manufacturers sell to overseas consumers, which lowers GDP.
  • The trade deficit can be improved by consume less and save more.

To know more about the causes of the trade deficit, here

brainly.com/question/10276258

#SPJ4

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NNADVOKAT [17]

it is false and uncommon for debt investors to push entrepreneurs to pursue less risky business strategies for their ventures.

Basically, debt investment entails an investor who lends his money to a firm, individual with an expectation of repayment of loan plus interest from them at a particular date.

The practice that borrowers should engage in less risky business strategies for their ventures will not be encouraged by debt investors because it is less risky and will not yield high return to allow them repay their loan quick enough.

Therefore, it is false and uncommon for debt investors to push entrepreneurs to pursue less risky business strategies for their ventures.

Read more about this here

<em>brainly.com/question/25219850</em>

3 0
2 years ago
From 2001 to 2004, the U.S. government went from a budget surplus to a budget deficit. According to the open-economy macroeconom
notsponge [240]

Answer: Option (a) is correct.

Explanation:

Correct Option: The supply of loanable funds but not the supply of dollars in the market for foreign-currency exchange.

If the budget deficit increases, then U.S residents will want to purchase fewer foreign assets and foreign residents wants to buy more of U.S assets.

The budget deficit in the economy has to be financed either by borrowing or by increasing taxes. This budget deficit occurred because of the tax cuts and higher government spending.

If a country running a budget deficit, which lead to reduction in national saving. We all know that interest rate is determined in the loan market, where savers supply the loans to the private borrowers.

So, if there is a fall in the national saving, this will reduced the supply of loans from savers, which raises the interest rate in an economy.

This will attract the foreign flow of capital. This means that demand for domestic assets increases because of the higher interest rate.

Now, if foreign residents want to take an advantage of higher interest rate then they first have to acquire domestic currency.

Therefore, higher interest increases the demand for domestic currency in a market of foreign exchange.

4 0
3 years ago
Why is budgeting important for a company? What are some reasons that a company would not prepare a budget?
zubka84 [21]

Answer: Budgeting helps to plan, coordinate , delegate responsibility and enhancing clarity in pursuit of an organisation.

Explanation: Every budgets is principally prepared to achieve a set target  but there some limitations which makes it  difficult for some companies to prepare and follow through with a budgeted plan action. Some of these limitations at any given point in time affect the activities of the organisation. It may be traced to Production capacity, shortage of labour, materials, space, Finance and customer demand. This  limitation can at any point in time affect the overall plan of the organisation making it difficult to achieve their set target .

7 0
4 years ago
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Mnenie [13.5K]
The right answer for the question that is being asked and shown above is that: "TRUE."Almost every phase of business and economic activity falls under some form of government regulation. This statement is true as far as the phase of business and economic activity is concerned.
7 0
3 years ago
Green Earth, an environmental organization in Oklahoma, recently recruited Phyllis Galvan as a project coordinator. Galvan's man
kotegsom [21]

Answer:

E) emotional contagion

Explanation:

Based on the scenario being described within the question it can be said that this example is demonstrating the concept known as emotional contagion. This concept refers to the process in which the emotions being experienced by an individual are caused by the emotions felt by others. Which is exactly what is happening in this scenario since Galvan's positive emotions are causing her colleagues to started behaving more positively as well.

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