Is the "international adjustment mechanism" for fixed and flexible exchange rates the same? Discuss briefly
What will be an ideal response?
No, R^ - E^ = P^F + Y^ - D^. If P^F increases, then with fixed rates R^ increases. With a float, E^ falls. With a managed float, (R^ - E^) increases with both R^ increasing and E^ falling.
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Talking about alternatives is the first step in a process that helps us make better choices about how we use our resources
Indicate whether the statement is true or false
The central bank of the United States is the:
A) First American Bank. B) Federal Reserve. C) Federal Deposit Insurance Corporation. D) U.S. Treasury.
Rising prices help control the process of resource depletion by
a. discouraging consumption and waste. b. stimulating more efficient use of the depletable resource. c. encouraging resource-saving innovation. d. doing all of the above.
Which statement is true?
A. Private business firms are illegal in China. B. In China today, there is strict adherence to the communist credo, "From each according to his ability, to each according to his needs." C. Major economic reforms in China in the late 1970s and early 1980s created a much more market oriented economy than a centrally planned one. D. None of the statements are true.