The price of gold is 300 U.S. dollars per ounce in New York and 435 Canadian dollars per ounce in Toronto, Canada. If the law of one price holds for gold, the nominal exchange rate is ________ Canadian dollars per U.S. dollar.
A. 0.333
B. 1
C. 0.690
D. 1.45
Answer: D
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When every country does what it is best at,
a. every other nation will lose because of the inability to compete. b. all other nations can benefit because more of every commodity can be produced. c. some nations will gain at the expense of other nations. d. rich nations will gain at the expense of poor nations.
Suppose we were analyzing the pound per Swiss franc foreign exchange market. If Switzerland's tax level rises relative to England and nothing else changes, then the:
a. The supply of Swiss francs in the foreign exchange market rises, and the demand for Swiss francs in the foreign exchange market rises, causing an uncertain change in the value of the Swiss franc. b. The supply of Swiss francs in the foreign exchange market falls, and the demand for Swiss francs in the foreign exchange market falls, causing an uncertain change in the value of the Swiss franc. c. The supply of Swiss francs in the foreign exchange market falls, and the demand for Swiss francs in the foreign exchange market rises, causing an appreciation of the Swiss franc. d. Neither supply nor demand in the foreign exchange market change because relative international prices influence trade flows and not the exchange rate. e. The supply of Swiss francs in the foreign exchange market rises, and the demand for Swiss francs in the foreign exchange market falls, causing a depreciation of the Swiss franc.
In 1950, the country with the highest per-capita GDP was
A) Switzerland. B) New Zealand. C) the United States. D) Venezuela. E) the Netherlands.
Suppose that utility-maximizing consumers in San Francisco pay three times as much for apples as for peaches. What is the ratio of the marginal utility of apples to the marginal utility of peaches?
A. 1/3 B. 3 C. 2/3 D. none of the above E. cannot determine without further information