One drawback to a single currency is that
A) the exchange rate is more volatile.
B) bond markets are larger and therefore harder to control.
C) exporters and importers have fewer choices about how they will receive and make payments.
D) individual nations cannot use monetary policy to stabilize the economy.
E) foreign currency is more expensive.
D
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According to the neoclassical growth model, economic growth occurs because of
a. increasing returns to scale. b. exogenous increases in technology. c. international trade that can increase knowledge. d. government policy which encourages savings. e. all of the above.
The demand equation for a single price monopolist is P = 120 - 3Q. The marginal revenue curve for this monopolist is
A. 120 - 1.5Q. B. 60 - 6Q. C. 60 - 3Q. D. 120 - 6Q.
In 1998 the Russian government defaulted on its bonds. According to the open-economy macroeconomic model, this should have
a. increased Russian interest rates and net exports. b. reduced Russian interest rates and net exports. c. increased Russian interest rates and reduced Russian net exports. d. reduced Russian interest rates and increased Russian net exports.
Based on the figure below. Starting from long-run equilibrium at point C, a decrease in government spending that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at__ creating _____gap.
A. B; no output B. D; an expansionary C. B; recessionary D. D; a recessionary