In 1990, Britain joined the ERM. If the German Bundesbank increased interest rates, assuming Britain maintains its exchange rate peg, the likely impact on the British economy would be a(n):
A) recession.
B) inflationary economy.
C) stronger pound.
D) decrease in taxes.
Answer: A) recession.
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The Keynesian approach assumes that
A) the economy is self-regulating. B) there is no unemployment in the economy. C) the price level is fixed. D) the government budget is always in deficit.
Which of the following is true?
i. When the world price of a good is lower than the price that balances domestic supply and demand, a country gains from exporting the good. ii. Compared to a no-trade situation, in a market with imports, consumer surplus is larger. iii. Quotas raise the domestic price of imported goods. A) only i B) only ii C) only iii D) i and ii E) ii and iii
Assume Jean-Claude purchased real estate for $500,000 using $50,000 of which is his own money and $450,000 of which he borrowed at an 8 percent interest rate. If the value increased by 10 percent in one year and he sold the property, what was Joe’s rate of return on his investment? If the value of the property had declined by 2 percent, what would have been the rate of return on his investment?
What will be an ideal response?
Borrowing VCU3 from an online company cause the nation's:
a. Monetary base to fall. b. M2 money supply to rise. c. M2 money multiplier to remain the same. d. M2 money supply to fall.