If an increase in the price of one good causes buyers to demand more of another good, then the two goods are:
A. normal goods.
B. inferior goods.
C. substitutes.
D. complements.
C. substitutes.
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In the foreign exchange market, how does each of the following influences affect the demand for dollars and the demand curve for dollars?
a) an increase in the exchange rate. b) an increase in the U.S. interest rate. c) a fall in the expected future exchange rate.
In response to the overvalued dollar in the early 1970s, the German Bundesbank bought dollars and sold marks to keep the exchange rate fixed, gaining international reserves
The huge purchase of international reserves meant that the German monetary base began to ________, leading to ________ growth in the German money supply. A) decline; sluggish B) decline; rapid C) grow; sluggish D) grow; rapid
A vertical aggregate supply curve implies __________ Phillips curve
A) an upward-sloping B) a downward-sloping C) a vertical D) a horizontal
Tobin's q theory adds to neoclassical theory because it ________
A) illustrates the important relationship between tax rates and the incentive to labor B) emphasizes the role played by asset price fluctuations on investment spending C) highlights the impact of a tax increase on business investment D) underlines the relationship between financial innovation and the financial crisis of 2007-2009