Hong Kong chooses to have ________ and ________ and therefore, cannot have an independent monetary policy at the same time
A) capital control; a fixed exchange rate
B) free capital mobility; a fixed exchange rate
C) free capital mobility; a flexible exchange rate
D) capital control; a flexible exchange rate
B
You might also like to view...
As new firms enter a monopolistically competitive market, product differentiation becomes less pronounced
Indicate whether the statement is true or false
A monopolistic competitor is like a monopolist in the short run in that when economic profits are
A. equal to zero, price equals marginal cost. B. equal to zero, price below marginal cost. C. greater than zero, price exceeds marginal cost. D. greater than zero, changes in output are due to changes to plants by existing firms and there is no entry.
As the MPS decreases, the multiplier will
A. decrease. B. increase. C. remain constant. D. either increase or decrease depending on the size of the change in investment.
Table 14.2Monetary Aggregates of the U.S. Financial SystemItemAmountCash held by public$100 billionTransactions deposits$300 billionRequired reserves$30 billionExcess reserves$0 billionU.S. bonds held by public$475 billionAssume an original balance sheet: If the Fed changes the required reserve ratio in Table 14.2 to 15 percent, the lending capacity of the system will eventually
A. Increase by $100 billion. B. Increase by $15 billion. C. Decrease by $1.5 billion. D. Decrease by $100 billion.