When the exchange rate appreciates in the short run and then depreciates to its original level in the long run, it implies that the foreign money supply has:
a. temporarily risen.
b. permanently risen.
c. temporarily fallen.
d. permanently fallen.
Ans: a. temporarily risen.
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Based on the figure below. Starting from long-run equilibrium at point C, a decrease in government spending that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at__ creating _____gap.
A. B; no output B. D; an expansionary C. B; recessionary D. D; a recessionary
The idea of comparative advantage implies that people or countries
A) should specialize in the production of goods. B) can gain from trading. C) can consume at a point outside their production possibilities frontier. D) all of the above.
Which of the following statements regarding a profit-maximizing monopolistically competitive firm is NOT true?
A) The MR curve lies below the demand curve. B) The firm produces the quantity at which the MR curve intersects the MC curve. C) The MC curve intersects the ATC curve at the ATC curve's lowest point. D) The firm's price equals the price at which the MR curve intersects the MC curve.
A Herfindahl index value of 20, for a particular industry, indicates that the industry is most likely to be:
a. perfectly competitive. b. highly concentrated. c. oligopolistic. d. monopolistic. e. made up of illegal firms.