All else being equal, if the prospect of a recession leads the Federal Reserve to ease monetary policy, the equilibrium value of the exchange rate for the U.S. dollar will:
A. either rise or fall depending on whether the supply or demand for dollars changes more.
B. fall.
C. remain fixed.
D. rise.
Answer: B
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Government regulations designed to reduce the moral hazard problem include
A) laws that force firms to adhere to standard accounting principles. B) light sentences for those who commit the fraud of hiding and stealing profits. C) state verification subsidies. D) state licensing restrictions.
If the price of automobiles were to decrease substantially, the demand curve for pizza would most likely
A) shift rightward. B) shift leftward. C) remain unchanged. D) remain unchanged while quantity demanded would change.
Raising an existing tariff on grapes from Chile will: a. increase U.S. imports of Chilean grapes
b. increase U.S. consumption of domestically produced grapes. c. increase total U.S. consumption of grapes. d. do all of the above.
The Law of Supply ______ holds for price-taking firms.
A. always B. usually C. occasionally D. never