4.Suppose the savings function for a small economy is given by the equation C = 100 + 0.6YD, where YD is disposable income. What is the marginal propensity to consume?

Select one:

a.0.2

b.1

c.0.8

d.100

e.0.4

5.Open market operations directly influence

Select one:

a.the government.

b.banks.

c.exporters.

d.firms.

e.households

6.In order to finance a current account deficit, a country can

Select one:

a.borrow money from abroad.

b.increase official reserves to cover the shortfall.

c.transfer money from the capital account to the reserve assets account.

d.lend money abroad.

e.reduce currency drain ratio.