When the market value of the dollar rises relative to other currencies around the world, we say that
A) the supply of dollars has increased. B) the dollar has appreciated.
C) the dollar has depreciated. D) the demand for dollars has increased.
B
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Refer to above figure. If trade were to open up between P and R, where would the world terms of trade locate in the figure above (somewhere on the PC/PF axis)? Would relative wages (w/r) in the two countries become equal? Is this consistent with the
Heckscher-Ohlin model? Explain.
A U.S. retailer buys shoes from an Italian company. The Italian firm then uses all of the revenues to buy leather from the U.S. These transactions
a. increase both U.S. net exports and U.S. net capital outflow. b. decrease both U.S. net exports and U.S. net capital outflow. c. increase U.S. net exports and do not affect U.S. net capital outflow. d. None of the above is correct.
Which is the most accurate statement?
A. Collective bargaining negotiations usually end as a strike. B. Most strikes cause devastating economic disruption. C. The firm with the least ability to withstand a strike would be a service firm.
Contractionary fiscal policy can lead to a depreciation of the nation's currency
Indicate whether the statement is true or false