In order to maintain an effective fixed exchange rate that differs from the market rate, the government must have
a. arbitrage capability
b. a surplus of merchandise exports
c. the ability to persuade other governments to control their exports
d. sufficient foreign exchange reserves
e. the ability to float high interest rates
D
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Using three separate graphs of conventionally-shaped TSB and TSCfunctions show that these values indicate that the regulations outlined in the CAAA of 1990 are (i) efficient; (ii) too lenient; and (iii) too stringent.
According to the EPA’s prospective analysis of the 1990 to 2010 period, total social benefits (TSB) associated with the CAAA of 1990 are estimated at $690 billion ($1990) and the comparable total social cost (TSC) estimates are $180 billion ($1990).
Jim is haggling with a car dealer on the price of a used car. If the dealer is getting a bonus per sale made, in addition to the commission, Jim is more likely to be able to
a. Get the car cheap b. Pay a higher price for the car c. Walk away from the deal d. All of the above
Supply-side economists argue that less government spending:
A. would make more investment capital available at lower rates of interest to the private sector. B. will result in more crowding out. C. causes higher rates of unemployment and inflation. D. would cause interest rates to increase dramatically.
If five firms of similar sizes join to form a cartel, then it is most likely that
A) they will charge a common, lower market price. B) they will collectively produce less than before. C) all five firms will earn the same profits as before. D) all five firms as a group will have falling profits, but increased output.