If the U.S. government wants to increase the price of the dollar relative to the euro, it could buy euros with dollars in the foreign exchange market.
Answer the following statement true (T) or false (F)
False
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In the economic way of thinking, money is
A) the root of all evil. B) what makes the world go round. C) a general medium of exchange. D) an institution, which tends to increase transaction costs. E) the source of scarcity in commercial society.
Investment, as defined for calculating GDP, consists of only two components: business spending on plant and equipment and unsold inventories
a. True b. False
Which of the following can policy do?
a. alter incentives b. alter trade-offs c. change opportunity costs d. All of the above are correct.
The unemployment rate does not tend to fall as soon as the economy pulls out of a recession. Which of the following best explains this?
A. During recessionary periods, firms switch to more capital-intensive production techniques, so they do not need to increase employment as the economy pulls out of the recession. B. Firms are holding excess labor, so as the economy pulls out of the recession, firms do not need to hire new workers immediately. C. Firms' optimism about the state of the economy increased prior to the economy pulling out of the recession, so firms increased their employment earlier. D. Firms are not able to find qualified workers to fill the job vacancies.