Hyundai is a large South Korean company that produces finished steel products. Hyundai plans to buy raw steel from U.S. Steel. As a result, the
A) demand curve for U.S. Dollars shifts rightward.
B) demand curve for U.S. Dollars shifts leftward.
C) demand curve for South Korean Won shifts rightward.
D) demand curve for South Korean Won shifts leftward.
A
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Ordinarily the Fed lends money only to banks, but during the Great Recession of 2007-2009 the Fed extended its lender-of-last-resort role to other financial institutions. These institutions included
A) securities dealers. B) investment banks. C) high-quality corporations. D) all of the above
In the above figure, an increase in aggregate demand has resulted in
A) a decline in the price level. B) economic growth. C) an inflationary gap. D) a recessionary gap.
Suppose the current exchange rate between the U.S. dollar and the Mexican peso is $0.10 = 1 peso. Furthermore, suppose the price level in Mexico rises 15 percent while the U.S. price level remains constant. According to the purchasing power parity theory, which of the following exchange rates comes closest to being the equilibrium exchange rate?
A) $0.087 = 1 peso B) $0.085 = 1 peso C) $0.115 = 1 peso D) $0.13 = 1 peso
Which of the following best describes a typical business cycle?
A. Economic expansions are followed by economic contractions. B. Inflation is followed by unemployment. C. Stagflation is followed by inflationary economic growth. D. Trade surpluses are followed by trade deficits.