Suppose that today 1 British pound exchanges for $1.60. If next week 1 pound exchanges for $1.70, it is clear that
A. The dollar has appreciated relative to the pound.
B. The pound has depreciated relative to the dollar.
C. The dollar has depreciated relative to the pound.
D. Both currencies have appreciated.
Answer: C
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The percentage of workers who work part time for noneconomic reasons
A) has decreased from 30 percent of the labor force in 1980 to 20 percent in 2011. B) does not fluctuate much at all with the business cycle. C) has trended upward since 1980. D) fluctuates strongly with the business cycle. E) decreases during a recession as the number of discouraged workers increases.
Suppose the money demand of individuals and firms depends on what they perceive to be the probabilities that the economy will expand or contract over the following six months
Suppose their money demand is given by the equation L = 0.5Y - 100i + 20z, where z is the probability that the economy is expanding six months in the future. If z = 1, the economy will certainly be in recovery, if z = 0, the economy will certainly be in recession, and for z between 0 and 1 there is some uncertainty about the future state of the economy. Use a classical (RBC) model of the economy. If the Fed moves the money supply to target the price level, how does the money supply relate to the expected future state of the economy? Is this an example of reverse causation?
A speculator who feels strongly that short rates will be rising over the next few years might want to be a __________ payer in a swap contract; if she is wrong there is __________ downside risk
A) fixed-rate; no B) fixed-rate; considerable C) floating-rate; no D) floating-rate; considerable
Let M = 36, k = 3, Ls = W/P, MPN = L-1/2 and Y = 2L1/2 . Calculate the labor demand curve, the aggregate demand curve, and the equilibrium values of the real wage, labor, output, and the price level
What will be an ideal response?