The figure below illustrates the market for British pounds. D£ and S£ are the nonofficial demand and supply curves of the British pounds, respectively.
A downward movement along the vertical axis would correspond to a(n) ________ of the U.S. dollar.
A. arbitrage
B. appreciation
C. swap
D. depreciation
Answer: B
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According to the quantity theory of money, a 10-percent increase in the money stock would lead to a 10-percent rise in the
a. the money wage and the price level. b. level of real GNP. c. level of nominal GNP. d. the money wage and the price level, but the price level rises by more e. Both a and c
Which of the following is emphasized by supply-side economics?
a. The impact of budget deficits on interest rates and aggregate demand. b. The impact of government spending on aggregate demand, output, and employment. c. The impact of marginal tax rates on aggregate supply. d. The impact of budget deficits on the rate of taxation in the future.
Based on the graph showing how the subprime share of home mortgages grew rapidly before the big decline, we can see that as adjustable mortgage rates ______, the share of subprime mortgages ______.
a. decreased; decreased
b. decreased; increased
c. decreased; remained unchanged
d. decreased; reached zero
Which of the following would be most likely to encourage capital formation in a less-developed country?
A. the expectation of sustained high inflation B. the expectation that property rights will be highly secure in the years ahead C. the imposition of high tariffs and other restraints limiting imports D. higher personal and corporate tax rates