If foreign residents purchase 30 billion pesos of Mexican assets and Mexican residents purchase 25 billion pesos of foreign assets, then Mexico has a net capital outflow of 5 billion pesos
a. True
b. False
Indicate whether the statement is true or false
False
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A firm sells 300,000 units per week. It charges $ 35 per unit, the average variable costs are $40, and the average costs are $55 . In the short run, the firm should
a. Shut-down as the firm is making a loss of $15 million per week b. Shut-down as the firm cannot cover the variable costs c. Shut down because the price is lower than average cost d. None of the above
The savings rate in Josiane’s country has been very low for many years. Describe how this has likely impacted the country’s growth rate. Provide brief examples.
What will be an ideal response?
Which of the following is not a likely consequence of inflation?
a) Firms incur the “menu costs” of changing advertisements b) Some taxpayers are pushed into higher tax brackets c) The value of currency is reduced d) Banks reduce nominal interest rates to reflect expected inflation e) Price signals sent by consumers to firms are distorted
Explain how a market demand curve is constructed.
What will be an ideal response?