If the dollar used to buy 120 yen and now buys 100 yen, there has been
A. depreciation of the yen.
B. appreciation of the dollar.
C. a decrease in the demand for yen.
D. depreciation of the dollar.
Answer: D
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According to historical data, what is the effect of a sharp change in the current account on the exchange rate (both in the short and long run)?
A) At first, home currency will depreciate as CA balance falls, but over time, currency will begin to depreciate. B) At first, home currency will appreciate as CA balance falls, but over time, currency will begin to depreciate. C) At first, home currency will appreciate as CA balance rises, but over time, currency will begin to depreciate. D) At first, home currency will depreciate as CA balance falls, but over time, currency will begin to appreciate. E) At first, home currency will appreciate as CA balance falls, but over time, currency will begin to appreciate.
The loanable funds market brings together savers and borrowers to determine the
a. marginal rate of return on investment b. rate of time preference c. market rate of interest d. marginal resource cost of investment e. marginal revenue product of investment
Labor unions tend to drive wages higher than they would be otherwise.
Answer the following statement true (T) or false (F)
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, as the economy moves from Point A to Point E, the opportunity cost of motorcycles, measured in terms of hybrid cars
A. remains constant. B. decreases. C. initially increases, then decreases. D. increases.