55)In the equation BB = tY - G - iPD, the difference between G and iPD is...

a.G represents spending by the federal government and iPD represents spending by interprovincial departments.

b.G represents spending outside the government's primary budget balance and iPD represents spending inside the government's primary budget balance.

c.G represents programme spending and iPD represents interest paid on the government debt.

d.iPD represents programme spending and G represents interest paid on the government debt.

56)If there is perfect capital mobility between Canada and the US and a Canadian asset offers a return of five percent and an identical US asset offers a return of three percent, we would expect...

a.The Canadian dollar should depreciate two percent in the coming year.

b.The Canadian dollar should appreciate eight percent in the coming year.

c.Perfect capital mobility will keep the US-Canada exchange rate constant.

d.The Canadian dollar should appreciate two percent in the coming year.

57)The component of aggregate demand that is most sensitive to interest rate changes is...

a.Government expenditure.

b.Net exports.

c.Investment.

d.Consumption.