Supply shocks:
A. occur more frequently than demand shocks.
B. usually result from fiscal and monetary policy changes.
C. occur when sellers face unexpected changes in the availability and/or prices of key inputs.
D. have been responsible for most of the recessions in the United States since World War II.
Answer: C
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The depreciation of the dollar will make U.S. goods ________ to foreigners and make imports ________ for U.S. residents
A) more expensive; cheaper B) cheaper; more expensive C) cheaper; cheaper D) more expensive; more expensive
In the monetary small open-economy model with a flexible exchange rate, an increase in the domestic price level has which impact on domestic money demand?
A) It increases it. B) It decreases it. C) It has no impact. D) It depends.
The demand curve for foreign exchange
a. slopes downward b. slopes upward c. is horizontal, because no individual country can influence the price of foreign exchange d. is vertical, because no individual country can influence the price of foreign exchange e. may slope downward or upward
Monopolists reduce producer surplus.
Answer the following statement true (T) or false (F)