The foreign exchange market
A) is a government-run market where foreign currencies are traded.
B) is a bank-owned market through which people buy and sell currencies.
C) refers to the entire array of institutions through which people buy and sell currencies.
D) an open market run by the Federal Reserve through which banks buy and sell currencies.
Ans: C) refers to the entire array of institutions through which people buy and sell currencies.
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Aggregate demand increases when
A) foreign incomes fall. B) interest rates rise. C) the exchange rate rises. D) None of the above answers is correct.
An increase in the price of raw materials will shift both the MC and the ATC curves upward
a. True b. False Indicate whether the statement is true or false
A Big Mac costs $4.56 in the United States and 9.2 zlotys in Poland. If the exchange rate is 3 zlotys per dollar, purchasing power parity predicts that
a) the zloty is overvalued b) the dollar is undervalued c) the dollar is overvalued d) both the zloty and dollar are undervalued
When a country exports a good, the country's producer surplus ________, consumer surplus ________, and the country ________ from the trade
A) increases; increases; gains B) decreases; increases; gains C) increases; decreases; gains D) decreases; decreases; loses E) increases; decreases; loses