Which of the following is a primary cause of exchange rate movements in the short run?
a. Changes in relative interest rates.
b. Changes in expectations of future exchange rates.
c. Changes in relative prices.
d. Changes in economic conditions such as relative GDPs.
e. None of the above.
D
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If Pearl is a risk averse, then
A) expected utility has nothing to do with her choices. B) she does not have diminishing marginal utility of wealth. C) she will not buy insurance. D) risk is costly to her.
A sign that the Federal Reserve is moving to lower interest rates would be
A) a reduction in bank reserves. B) an increase in margin requirements. C) a widening gap between the Treasury bill yield and the discount rate. D) a narrowing gap between the Treasury bill yield and the discount rate.
How many times is GDP for a particular quarter estimated?
A) once B) twice C) three times D) more than three times
The existence of recessions highlights
a. the strengths of the Federal Reserve b. the need for the "other things equal" assumption c. our failure to consider differences between the short run and long run d. how confusing the economy can become e. the interdependence between production and income