Government officials wanting to defend a fixed exchange rate may not have sufficient reserves of foreign currency to keep the price fixed indefinitely.
Answer the following statement true (T) or false (F)
True
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Changes in aggregate spending not caused by changes in output or the inflation rate, also known as exogenous changes in spending, will shift the:
A. short-run aggregate supply curve. B. potential output line. C. aggregate demand curve. D. long-run aggregate supply curve.
Define price discrimination. What factors must be present in order for a firm to price discriminate? Why do firms price discriminate?
What will be an ideal response?
Which of the following is NOT an assumption used in deriving a production possibilities curve?
A) The labor force is growing at a constant rate. B) Resources are fully employed. C) Technology is constant. D) The quantity of resources is constant.
If the calculated price elasticity of demand between two points is -4, demand is
A) inelastic. B) elastic. C) unresponsive to price. D) unit-elastic.