As an exchange rate regime, target zones would be classified as
A) splitting the difference between fixed and flexible.
B) a flexible exchange rate policy.
C) a fixed exchange rate policy.
D) a currency basket.
A
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The value of the multiplier increases when the MPC increases
Indicate whether the statement is true or false
Suppose that the firm's only variable input is labor. When 50 workers are used, the average product of labor is 50 and the marginal product of labor is 75. The wage rate is $80 and the total cost of the fixed input is $500. Suppose that installation of a new assembly line increases the output produced per worker. The cost per unit of output
A. will increase. B. will be unchanged. C. will decrease. D. is at its maximum. E. is at its minimum
Initially, workers in the shoe industry and the computer industry earn the same wage. Reductions in trade barriers give domestic consumers access to cheaper shoes produced abroad, which causes domestic shoe prices fall. At the same time, foreign consumers purchase more computers, raising the relative price of computers. As a result of these changes, the demand for labor in the shoe industry ________ and the demand for labor in the computer industry ________.
A. decreases; increases B. increases; increases C. increases; decreases D. decreases; decreases
A change in the reserve requirement causes a change in all of the following except
A. The money multiplier. B. Excess reserves. C. The lending capacity of the banking system. D. Pretax income.