Which of the following is included in the supply of U.S. dollars in the market for foreign-currency exchange in the open-economy macroeconomic model?
a. a U.S. bank loans dollars to Tom to buy a U.S. made motorcycle
b. a U.S. tire maker wants to build a new factory in China
c. a U.S. company wants to import goods to sell in its retail stores
d. All of the above are correct.
b
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An implication of scarcity is that:
A. making trade-offs becomes unnecessary as wealth increases. B. people must make trade-offs. C. some people will always be poor. D. people will never be happy.
Which of the following statements about international trade is true?
A) Potentially, a country can have absolute advantage in all goods. B) Potentially, a country can have relative advantage in all goods. C) After trade, countries tend to specialize in the production of those goods in which they enjoy absolute advantage. D) None of the above is true.
Cartels frequently break down in the long run because
a. they are illegal b. tacit collusion is illegal c. contracts and agreements are legally binding d. cooperative behavior usually lowers profits for the entire industry e. members have an incentive to increase output
In market systems, the main way that valuable resources are transferred from households to firms is:
A) through direct barter exchange of labor for goods and services. B) through government sponsored distribution such as in providing public K-12 schooling. C) through markets based on money payments. D) a circular flow where the firms provide resources to households and the households reciprocate by providing finished goods and services to firms.