To maintain a functioning gold standard:
A) nations are obliged to exchange any amount of issued paper money for gold.
B) paper money is not allowed; all transactions must be in coins or gold.
C) the monetary authority cannot exchange currency for gold.
D) care must be taken to keep inflation under 10%.
Ans: A) nations are obliged to exchange any amount of issued paper money for gold.
You might also like to view...
A competitive equilibrium is Pareto-efficient because at the competitive equilibrium,
A) prices have been allowed to adjust. B) there are no further gains from trade. C) the final outcome is different from the original inefficient endowment. D) all members of society can be made better off.
If a company making frozen orange juice expects the price of its product to be higher next month, it will supply more to the market this month
a. True b. False Indicate whether the statement is true or false
Which of the following best describes how a perfectly competitive industry would respond to a sudden increase in popularity of the product? The market demand curve would shift to the right, leading to:
A. no change in the short-run equilibrium price, and a higher long-run equilibrium quantity. B. a higher equilibrium price in the short run and entry into the market in the long run. C. a higher equilibrium price in the short run and a permanent increase in economic profit. D. a lower short-run equilibrium price due to the entry of firms into the market.
Figure 18-2
In , which of the following would cause the American demand for foreign exchange (pounds) to shift from D1 to D2?
a.
an increase in the U.S. real interest rate
b.
higher inflation in Britain than in the United States
c.
higher income growth in Britain than in the United States
d.
an increased level of vacation travel to Britain by Americans