The buying and selling of foreign currency by the central bank is a trade policy whose objective is:
A. reducing purchases of assets abroad.
B. stabilizing the exchange rate against external shocks.
C. stabilizing the interest rate against foreign capital outflows.
D. promoting long term economic growth.
Answer: B
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Refer to Table 14-3. Is there a dominant strategy for Saudi Arabia and, if so, what is it?
A) Yes, the dominant strategy is to produce a low output. B) Yes, it has a dominant strategy depending on what Nigeria does. C) Yes, the dominant strategy is to produce a high output. D) No, there is no dominant strategy.
A cost of living adjustment (COLA)
a. changes wages by the same percentage every year. b. decreases wages by the inflation rate. c. increases wages by the inflation rate. d. changes prices of consumer goods by the inflation rate.
Keynesian economists believe that fiscal and monetary policies are necessary to offset
A. changes in the price of gold. B. the difference between imports and exchange rates. C. the inherent instability of the private sector. D. the growth of monopoly business and labor unions.
Refer to the information provided in Figure 23.3 below to answer the question(s) that follow.
Figure 23.3Refer to Figure 23.3. Aggregate saving is $240 if aggregate income is
A. $300. B. $500. C. $800. D. $1,000.