If the price of goods X and Y change proportionally, then which of the following is true?
a. The budget line will not change because the prices have changed proportionally.
b. It is not clear what happens to the budget line because too many factors have changed.
c. It will appear as if the budget line has shifted even though income has not changed.
d. It will appear as if the budget line pivoted and the slope will change because prices changed.
c. It will appear as if the budget line has shifted even though income has not changed.
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When the Federal Reserve buys bonds on the open market, it decreases the money supply
Indicate whether the statement is true or false
Most countries tend to follow only one price index to measure the price level in an economy because all prices rise or fall at the same time or by the same amount
a. True b. False Indicate whether the statement is true or false
When more than one central bank attempts to shift the equilibrium exchange rate, we refer to this as:
a. sterilization. b. a currency crisis. c. coordinated intervention. d. an application of special drawing rights. e. a floating exchange rate system.
Refer to the information provided in Figure 5.4 below to answer the question(s) that follow.
Figure 5.4Refer to Figure 5.4. Along the given demand curve, which of the following is true?
A. Since the demand curve is linear, the price elasticity of demand between each of the points is the same. B. Demand is less elastic along the segment EF than the segment AB. C. Demand is less elastic along the segment AB than the segment EF. D. All of the above are true.