Use the following table, which shows the supply and demand schedules for the euro, to answer the next question.Quantity of Euros SuppliedPriceQuantity of Euros Demanded400$1.101003601.002003000.903002860.804002670.70500Under a flexible exchange rate system, what will be the euro rate of exchange for one U.S. dollar?
A. 1.11 euros
B. 1.00 euros
C. 0.95 euro
D. 1.23 euros
Answer: A
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One key implication of rational expectations is that
A) anticipated monetary policy has no effect on the rate of unemployment or the level of real GDP. B) unanticipated monetary policy has no effect on the economy but anticipated monetary policy does have an effect on the economy. C) anticipated monetary policy can affect the rate of unemployment but not the level of real GDP. D) both unanticipated monetary policy and anticipated monetary policy have an effect on the economy.
The concept of opportunity cost in a fully employed economy with technology and resources held constant tells us that
a. expansion of output in one industry means expansion cannot occur in another industry. b. expansion of output in one industry means output in another industry must contract. c. output cannot be increased in any industry. d. output of all industries must contract until more resources are found.
M1
A. includes credit cards. B. includes small time deposits. C. is the sum of currency plus travelers checks. D. is the narrowest definition of the money supply.
The poverty line goes up as the size of the household increases. A doubling of the family size
A. exactly doubles the poverty line. B. less than doubles the poverty line. C. more than doubles the poverty line.