The graph below shows a change in the demand for Swiss francs from D1 to D2. What would happen when D1 shifted to D2 under a flexible exchange rate system compared to a fixed exchange rate system?
Under a flexible system the price of a Swiss franc would increase from $0.20 to $0.25. Under a fixed exchange rate system the price of a Swiss franc would remain at $0.20. The shortage equal to ac would be met using international reserves or through gold sales.
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Blood tests administered to applicants for medical insurance are an example of an attempt by insurance companies to deal with the problem of
A) moral hazard. B) the drug abuse problems currently plaguing the country. C) adverse selection. D) failure of policyholders to keep paying their premiums.
The Federal Trade Commission Act declares that all of the following are illegal except which one?
A) deceptive acts or practices in or affecting commerce B) mergers C) unfair acts or practices in or affecting commerce D) unfair methods of competition in or affecting commerce
Suppose a state has the following individual income tax structure.The first $20,000 that an individual earns is taxed at 5%. The next $30,000 is taxed at 10%. Any income exceeding $50,000 is taxed at 20%.Based on this tax structure, if a person's income is equal to $60,000 . his average tax rate is equal to:
a. 15% b. 10% c. 11.67% d. 20%
Economies of scale account for what part of a long-run average total cost curve?
A. Downward-sloping B. Upward-sloping C. Vertical D. Horizontal