When foreign residents increase their demand for U.S. dollars, ceteris paribus,
A. Foreign residents, at the same time, reduce their supply of foreign currency to the foreign exchange market.
B. The dollar will depreciate in value.
C. The dollar price of foreign currency will rise.
D. The dollar will appreciate in value.
Answer: D
You might also like to view...
Recall the Application. One difference between a value-added tax and an income tax is the value-added tax
A) is a progressive tax. B) is not a consumption tax. C) does not penalize individuals who save. D) is difficult to collect.
Say you had an 8 A.M. economics class, and you only come to campus to attend your economics class. The cost of coming to the economics class would then include: a. the value of the time it took to drive to campus. b. the cost of the gasoline it took to get to campus. c. the cost of insuring the car for that day
d. a. and b.
The nominal interest rate is 4%, the inflation rate is 1% and the tax rate is 20%. Given U.S. tax laws, how is after-tax real return computed?
a. .03(1-.20) b. .04(1 -.20) c. .04(1 - .20) - .01 d. None of the above is correct.
Refer to Scenario 19.3 below to answer the question(s) that follow. SCENARIO 19.3: Suppose demand for widgets is given by the equation P = 20 - 0.5Q. Originally, the price of the good is $10 per unit. When a tax of $2 per unit is imposed, the price of the good rises to $12 per unit.Refer to Scenario 19.3. How much total tax revenue is raised by the tax?
A. $2 B. $20 C. $32 D. $40