Which of the following, all else fixed, will cause the real exchange rate to increase?
A) a nominal depreciation
B) a reduction in the foreign price level
C) a reduction in the domestic price level
D) all of the above
E) none of the above
B
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The figure above shows a tax imposed on a good with an external cost. The area of the rectangle abcd equals
A) the MSB. B) the total tax revenue collected by the government. C) the amount of pollution tax per ton. D) the MC. E) the deadweight loss.
A price ceiling below the market clearing price results inI.excess quantity demandII.excess quantity suppliedIII.entry of new producers
A. I only B. II only C. III only D. Both I and III
The elasticity formula solves the units problem because percentages are unaffected by the units of measure.
Answer the following statement true (T) or false (F)
The Corporate Average Fuel Economy (CAFE) standards are designed to improve the average fuel economy of cars and light trucks sold in the U.S. The economic analysis used to develop the CAFE standards was:
A) macroeconomic. B) positive. C) normative. D) none of the above