All else equal, U.S. imports from Germany create a:
A. demand for European euros.
B. supply of European euros.
C. demand for American dollars.
D. surplus of European euros.
A. demand for European euros.
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Monetarism is a school of thought put forth by Milton Friedman. He argued that the economy would most likely
A) be below potential GDP. B) be above potential GDP. C) be unstable. D) be at potential GDP.
Suppose that your income during Year X was $50,000 . and the CPI for Year X was 150 (base year = Z=100). Back in Year Z your income was $30,000 . Has your real income increased or decreased from Z to year X? By how much?
a. Increased by $5,000. b. Increased by $3,333. c. Unchanged. d. Decreased by $3,333. e. Decreased by $5,000.
Which of the following explains how to use the Herfindahl-Hirschman Index?
a. Summing the squares of the market share of each firm in the industry b. Calculating each firm’s share of the total sales in the industry c. Multiplying the squares of the market share of each firm in the industry d. Dividing each firm’s share of total industry sales by the firm’s sales
Assume that the central bank increases the reserve requirement. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the real risk-free interest rate and reserve-related (central bank) transactions in the context of the Three-Sector-Model?
a. The real risk-free interest rate rises, and reserve-related (central bank) transactions become more positive (or less negative). b. The real risk-free interest rate rises, and reserve-related (central bank) transactions become more negative (or less positive). c. The real risk-free interest rate rises, and reserve-related (central bank) transactions remain the same. d. The real risk-free interest rate and reserve-related (central bank) transactions remain the same. e. The real risk-free interest rate falls, and reserve-related (central bank) transactions become more negative (or less positive).