International trade shocks are more disruptive with fixed exchange rates than with floating exchange rates.
Answer the following statement true (T) or false (F)
True
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A firm uses an efficiency wage scheme to deter workers from shirking. A risk-neutral worker will not shirk if
A) the expected loss from being fired is larger than or equal to the gain from shirking. B) the expected loss from being fired is smaller than the gain from shirking. C) the gain from shirking is positive. D) the expected loss from being fired is zero.
The idea that consumption increases at the same rate as national income so that MPC is constant, is known as the
a. absolute income hypothesis b. Keynesian income hypothesis c. relative income hypothesis d. permanent income hypothesis e. rational income hypothesis
The basic reason for the gas lines in 1973 and 1979 was _____.
Fill in the blank(s) with the appropriate word(s).
The graph above shows supply and demand in the domestic market without trade. Producer surplus without trade is represented by area
A) P1-E-Po B) P1-E-0 C) Po-E-0 D) P1-E-Qo