When a new product is introduced in the market, a consumer always wants to see how popular the item becomes before she purchases it. The consumer's behavior is known as
A) overt collusion.
B) limit-pricing.
C) a network effect.
D) a rational decision.
Answer: C
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A speculative attack is:
A. a massive selling of domestic currency assets by domestic and foreign financial investors. B. a presumptive decrease in the officially fixed value of a currency. C. a presumptive increase in the officially fixed value of a currency. D. the imposition of tariffs and quotas to prevent the inflow of foreign goods.
If disposable income falls by $40 billion and consumption falls by $30 billion, then the slope of the consumption function is
A) 1.33. B) 0.75. C) 0.4. D) 0.3.
Everything else held constant, if a central bank makes an unsterilized ________ of foreign assets, then the domestic money supply will increase and the domestic currency will ________
A) purchase; appreciate B) purchase; depreciate C) sale; appreciate D) sale; depreciate
In 2011, the U.S. experienced
a. both current account and financial account deficits. b. a deficit in the current account and a surplus in the financial account. c. a surplus in the current account and a deficit in the financial account. d. a surplus in both the current account and the financial account.