Transactions costs are defined to be the:
A. costs a buyer or seller incurs to make a transaction take place.
B. taxes they pay when purchasing a good or service.
C. fees they are charged if they purchase a good or service on credit.
D. costs a buyer faces if they re-sell a good or service.
A. costs a buyer or seller incurs to make a transaction take place.
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Which of the following statements is correct?
A. In the short run, interest rate differentials have the greatest impact on exchange rates. B. In the medium run, differences in growth rates of aggregate demand have the greatest impact on exchange rates. C. In the long run, price and inflation differentials have the greatest impact on exchange rates. D. All of the above are correct.
The labor force is 100 million and the unemployment rate is 5 percent. One million people quit looking for a job. What is it called when an individual leaves the labor force, and in this case what is the new unemployment rate?
A) Encouraged worker, 5 percent. B) Discouraged worker, 5.05 percent. C) Discouraged worker, 3 percent. D) Discouraged worker, 4.04 percent.
What do rational expectations theorists believe? What is their critics' point of view?
Tour companies and cruise lines often offer last minute fares that are far below the prices paid by customers who have booked their trips far in advance. Use marginal analysis to explain this pricing tactic.
What will be an ideal response?