Chapter 19 - A Macroeconomic Theory of the Open Economy

Tariff

________- a tax on imported goods.

Capital flight

________- a large and sudden reduction in the demand for assets located in a country.

Trade

________ policy- a government policy that directly influences the number of goods and services that a country imports or exports.

Government budget deficit

________ represents a negative public saving.

equilibrium interest rate

At the ________, the amount that people want to save exactly balances the desired quantities of domestic investment and net capital outflow.

Import quota

________- a limit on the quantity of a good produced abroad that can be sold domestically.

Net capital outflow curve

________ is the link between the market for loanable funds and the market for foreign currency exchange.

Net Capital Outflow

________: The Link between the Two Markets:**

net capital outflow

The ________ does not depend on the exchange rate.