The figure below illustrates the market for British pounds. D£ and S£ are the nonofficial demand and supply curves of the British pounds, respectively.
At an exchange rate of $2.50 per pound, there is an
A. excess demand for 0.5 million pounds.
B. excess supply of 1 million pounds.
C. excess demand for 1 million pounds.
D. excess supply of 0.5 million pounds.
Answer: B
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Price discrimination
A. may lead to greater output. B. always leads to a reduction of output. C. leads to lower profits for the firm. D. causes firms to operate at a higher cost.
Which of the following statements is correct for an open economy with a trade surplus?
a. The trade surplus cannot last for very many years. b. The trade surplus must be offset by negative net capital outflow. c. The trade surplus implies that the country's national saving is greater than domestic investment. d. None of the above is correct.
One way the government can boost the economy out of a recession is:
A. with public announcements telling the public to save their money. B. by increasing government spending. C. by setting price ceilings on most goods so people can afford them. D. None of these will help an economy in recession.
more foreign investment, attracted by the expectation of economic and political stability
What will be an ideal response?