Exchange rates are affected by changes in:
A. The supply of a currency only.
B. The demand for a currency only.
C. Both the demand for and supply of a currency.
D. The export of goods only.
C. Both the demand for and supply of a currency.
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The marginal rate of substitution is equal to the
A) slope of the demand curve. B) marginal cost of each good. C) magnitude of the slope of the indifference curve. D) relative prices of the two goods.
One reason dressing well for a job interview may not be an effective signal is
A. people who are more serious about getting a job will make the investment in a new suit. B. buying a suit takes time away from studying. C. it is costly for a person less interested in the job to buy a new suit. D. a person who has successfully completed a job-training program might be unable to afford a new suit.
According to the Laffer curve, when the tax rate is 100 percent, tax revenue will be
a. 0 b. at a maximum c. the same as they would be at a 50 percent tax rate d. greater than they would be at a 50 percent tax rate e. the same as they would be at a 20 percent tax rate
When interest rates come down,
a. people on average are better off since borrowing is now less expensive. b. people on average are worse off since the income of lenders will now decrease. c. social welfare is left unchanged since what borrowers gain is exactly offset by what lenders lose. d. people on average may or may not be better off, depending on how high the rate was to begin with.