In the open-economy macroeconomic model, if there is currently a surplus in the foreign exchange market, the quantity of desired net exports will increase as the market moves to equilibrium
a. True
b. False
Indicate whether the statement is true or false
True
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Assume that seigniorage and the government's primary deficit are both zero. A change in the debt-to-GDP ratio depends on just
A) the rate of inflation and total factor productivity. B) the growth rate of real GDP and the real interest rate. C) the growth rate of the money supply and the nominal interest rate. D) the growth rate of nominal GDP and the rate of inflation.
If an increase in the price of one input causes an increase in demand for labor, the two inputs are
A) complementary. B) substitutes. C) interchangeable. D) flexible.
If prices (as measured by the CPI) fell by one-half and nominal wages fell by one-third, what would happen to real wages?
a. They would fall by one-third b. They would remain unchanged c. They would decrease d. They would increase e. They would fall by one-half
Since a monopolistic competitor produces a product with many close substitutes, but none exactly like it. As a result, the firm:
a. has no market power. b. faces a highly inelastic demand curve. c. has unlimited market power. d. has some degree of market power.