Refer to Figure 18.2. After trade and specialization begin, the maximum amount of fishing poles that Macadamia can consume is
A) 40. B) 100. C) 120. D) 160.
C
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Increases in net investment generally result in
A) higher levels of capital stock and lower levels of depreciation. B) lower levels of capital stock and higher levels of depreciation. C) lower levels of capital stock and lower levels of depreciation. D) higher levels of capital stock and higher levels of depreciation.
The assumption that a perfectly competitive industry has many sellers, each selling an identical product, leads to the conclusion that
A) consumers get to see a variety of outputs. B) there are many buyers. C) the economic profit will be positive in the long run. D) firms are price takers.
With velocity constant and equal to 2, a $10 billion increase in the money supply shifts the LM curve to the right by
A) $2 billion. B) $5 billion. C) $10 billion. D) $20 billion.
Suppose a bank in Germany borrows $2 million U.S at an interest rate of 5%. The bank then converts the amount into euros, the local currency, at a rate of 2 euros per dollar. It lends the €4 million at an interest rate of 15% to other firms. After one year, the loan is repaid with interest, and the bank receives €4.6 million. The bank now wants to pay back the debt. If the current exchange
rate is 3 euros per dollar, the bank will: a. face a loss of $570,000 approximately. b. face a loss of $470,000 approximately. c. make a profit of $500,000 approximately. d. make a profit of $320,000 approximately.