Assume that the Fed performs a foreign exchange intervention in which it does nothing except buy German government bonds. One result of this will be that:
A. both the dollar and the euro depreciate.
B. the dollar appreciates and the euro depreciates.
C. the euro depreciates.
D. the dollar depreciates.
Answer: C
You might also like to view...
Describe the recession phase of a business cycle, including when it begins and when it ends
What will be an ideal response?
Explain the time dimension as it relates to elasticity. Be sure to include in your answer the difference in elasticity between the short run and the long run
What will be an ideal response?
The term "double coincidence of wants"
A. means that people are trying to purchase the same thing. B. is a situation where runaway prices are the result of printing too much money. C. describes a barter situation where individuals agree to trade commodities in amounts satisfactory to both parties. D. means that people with the same commodities agree to trade among themselves.
Robin owns a horse stables and riding academy and gives riding lessons for children at "pony camp.". Her business operates in a competitive industry. Robin gives riding lessons to 20 children per month. Her monthly total revenue is $4,000 . The marginal cost of pony camp is $250 per child. In order to maximize profits, Robin should
a. give riding lessons to more than 20 children per month. b. give riding lessons to fewer than 20 children per month. c. continue to give riding lessons to 20 children per month. d. We do not have enough information to answer the question.