If foreigners decide that they no longer want to acquire U.S. financial assets, we can expect the value of the dollar to:
A. fall and the trade deficit to rise.
B. rise and the trade deficit to rise.
C. fall and the trade deficit to fall.
D. rise and the trade deficit to fall.
Answer: C
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Fuji and Kodak produce identical film. The market demand for film is given by P = 8 - Q, where P is the price (in dollars per roll of film) and Q is the quantity (in hundreds of rolls). Each firm has the option of producing 150, 200, or 300 rolls of film at a constant marginal cost of $2 per roll with no fixed costs. The firms' possible profits for various outcomes are summarized in the accompanying table.
(i) If the two firms behave competitively, what will be the outcome of this game? Is this outcome Pareto optimal for the firms?
(ii) If the two firms merge and form a monopoly, what will be the outcome of this game? Is this outcome Pareto optimal for the firms?
(iii) What is the Nash equilibrium for this game? Is it Pareto optimal for the firms? How does it compare with the competitive and monopoly outcomes?
(iv) Suppose this game is played sequentially, with Fuji as the first player. What will be the Stackelberg equilibrium? Is it Pareto optimal?
Extractive institutions control political power to:
A) enforce property rights and an equitable legal system. B) allow new businesses to enter and compete in a market. C) transfer resources from the ruling party to society. D) transfer resources from society to the ruling party.
Membership in unions in the United States
a. is slightly over 90 percent of all workers b. has declined steadily since 1980 c. was hindered by laws such as the Wagner Act d. can be a grounds for an employer to fire an employee e. reached an all-time high in 1998
As the wage rate rises to extremely high levels, the ____________ becomes stronger than the ____________.
A. income effect; substitution effect B. substitution effect; income effect C. marginal revenue product; resource demand D. None of these choices are correct.