Strategic advertising in the cola market
A) significantly expands the size of the market.
B) brings in few new customers and primarily shifts market share among rivals.
C) shifts market demand to the right, increasing quantity sold and decreasing prices.
D) has no impact on the market.
B
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Under the monetary approach to exchange rate theory, money supply growth at a constant rate
A) eventually results in ongoing price level deflation at the same rate, but changes in this long-run deflation rate do not affect the full-employment output level or the long-run relative prices of goods and services. B) eventually results in ongoing price level inflation at the same rate, but changes in this long-run inflation rate do affect the full-employment output level and the long-run relative prices of goods and services. C) eventually results in ongoing price level inflation at the same rate, but changes in this long-run inflation rate do not affect the full-employment output level or the long-run relative prices of goods and services. D) eventually results in ongoing price level inflation at the same rate, but changes in this long-run inflation rate do not affect the full-employment output level, only the long-run relative prices of goods and services. E) eventually results in ongoing price level deflation at the same rate, but changes in this long-run deflation rate do not affect the full-employment output level, only the long-run relative prices of goods and services.
Which of the following is a valid statement?
a. Excess reserves = total reserves minus required reserves. b. Required reserves = the minimum reserves required by the Fed. c. Required reserve ratio = required reserves as a percentage to total deposits. d. All of these.
Most economists believe that a tradeoff between inflation and unemployment exists
a. only in the short run. b. only in the long run. c. in both the short and long run. d. in neither the short nor long run.
For an investor who starts with pesos and wants to end up with pesos in the future, which of the following choices is an example of an uncovered international investment?
A. Sell dollars at the spot rate, invest the proceeds in foreign currency-denominated financial instruments, and then, buy pesos at the future spot rate B. Buy a peso-denominated financial asset C. Sell pesos at the spot rate, invest the proceeds in foreign currency-denominated financial instruments, and sign a forward exchange contract to buy the foreign currency D. Sell pesos at the spot rate, invest the proceeds in foreign currency-denominated financial instruments, and sign a forward exchange contract to buy pesos