Assume a contractionary monetary policy causes real interest rates in the US to increase relative to Japan. In the short run, the value of the US dollar, the value of the Japanese yen, and the US balance of trade will most likely change in which of the following ways?
a. appreciate; appreciate; move toward deficit
b. appreciate; depreciate; move toward deficit
c. appreciate; depreciate; move toward surplus
d. depreciate; depreciate; move toward surplus
e. no change; appreciate; move toward deficit
Answer: b. appreciate; depreciate; move toward deficit
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Consider two countries: a) In the first country there are 1,000 individuals; among them 500 earn $20,000 per month and the remaining 500 earn $400 per month
b) In the second country there are 1,000 people; among them 500 earn $12,000 per month and the remaining 500 people earn $600 per month. Which of the two countries has more inequality and which country is poorer of the two?
How does a firm in monopolistic competition decide how much to produce and at what price to offer its product for sale?
What will be an ideal response?
A tariff on a product
a. enhances the economic well-being of the domestic economy. b. increases the domestic quantity supplied. c. increases the domestic quantity demanded. d. results in an increase in producer surplus that is greater than the resulting decrease in consumer surplus.
Compare pure competition, pure monopoly, monopolistic competition, and oligopoly for technological advance in the form of new product development
What will be an ideal response?