Suppose we were analyzing the Turkish lira per euro foreign exchange market. If The Euro-Area's tax level falls relative to Turkey and nothing else changes, then the:
a. The supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market falls, causing a depreciation of the euro.
b. The supply of euros in the foreign exchange market falls, and the demand for euros in the foreign exchange market falls, causing an uncertain change in the value of the euro.
c. The supply of euros in the foreign exchange market falls, and the demand for euros in the foreign exchange market rises, causing an appreciation of the euro.
d. Neither supply nor demand in the foreign exchange market change because relative international prices influence trade flows and not the exchange rate.
e. The supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market rises, causing an uncertain change in the value of the euro.
.C
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Which of the following is an example of detrimental externality?
a. A trailer's entry onto an overcrowded road that delays the movement of other vehicles. b. Fall in demand for gasoline in the US softens the price of gasoline in the global market. c. Government investment in energy generation from non-conventional sources. d. Society devotes huge quantity of its scarce resources for vital innovative activity.
Pure monopoly is defined as a
a. one-firm industry. b. market structure in which there are many substitute products. c. market structure maintained by entry of many rival firms. d. market structure created by special government sanctions.
Other things the same, an increase in domestic prices raises the real exchange rate
a. True b. False Indicate whether the statement is true or false
Which of the following did NOT happen during the late 19th century in the U.S.?
a. Falling crop prices reduced farmers' incomes b. From 1880 to 1896, the price level fell by 23 percent c. Farmers lobbied for government policies to reduce inflation d. Farmers had reduced ability to pay off debts