Reducing _____ the benefits available to the buyer and seller and might also enable them to make exchanges that were previously impossible
a. transaction costs decreases
b. transaction costs increases
c. marginal costs decreases
d. marginal costs increases
B
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When the foreign exchange value of the Mexican peso is above its equilibrium rate, the peso will:
a. tend to be revalued. b. tend to increase in value over other currencies. c. be high demand in the foreign exchange market. d. tend to depreciate. e. tend to appreciate.
The monetary policy weapon least often used by the Fed is ____________.
Fill in the blank(s) with the appropriate word(s).
Suppose that during the last five years the rate of inflation was 3 percent each year and the money supply had grown 6 percent annually during the period. However, during the last nine months, the Fed has expanded bank reserves more rapidly and the money supply has been growing at a 12 percent annual rate. As a result, the expected inflation rate for the next period will be
a. higher than 3 percent under the rational expectations hypothesis. b. 3 percent under the adaptive expectations hypothesis. c. higher than 3 percent under both the adaptive and rational expectations hypotheses. d. both a and b.
Which term below refers to "the accumulation of goods produced in the past that are being used in the present to produce new goods and services"?
a. inventories b. products c. factors of production d. capital