The purchasing power parity theory claims that a change in relative ________ between two countries must cause a change in ________ in order to keep the prices of goods in two countries fairly similar.

A) exchange rates; inflation
B) inflation; exchange rates
C) interest rates; inflation
D) interest rates; exchange rates


B) inflation; exchange rates

Economics

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Free riding is primarily a characteristic of pure private goods

Indicate whether the statement is true or false

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Under the Patient Protection and Affordable Care Act (ACA), individuals who do not have health insurance will be subject to a fine

Indicate whether the statement is true or false

Economics

A price ceiling is binding when it is set

a. above the equilibrium price, causing a shortage. b. above the equilibrium price, causing a surplus. c. below the equilibrium price, causing a shortage. d. below the equilibrium price, causing a surplus.

Economics

Using the labor market, the production function Real GDP = T (L, K), and the LRAS curve, describe the process by which a decrease in income taxes impacts economic growth

Economics