If Great Britain experiences higher rates of inflation than the United States over a long period of time, we should expect the British £ (pound) per U.S. $ (dollar) exchange rate to:
A. hold constant, there isn't any link between inflation and exchange rates.
B. fluctuate in a narrow range set by the Bank of England.
C. increase.
D. decrease.
Answer: C
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If a country wants to promote future growth, it should
A) produce more capital goods today. B) produce more consumer goods today. C) produce only economic goods. D) produce only needed goods.
Suppose the market for "soda X" is in equilibrium. If the FDA announced today that this soda has been proven to cause a fatal disease, what would be most likely to happen to the equilibrium price and equilibrium quantity of soda X?
A. Price increases and quantity increases B. Price decreases and quantity increases C. Price increases and quantity increases D. Price decreases and quantity decreases
In a perfectly competitive industry, an individual firm faces
A) a perfectly inelastic labor supply curve. B) a perfectly vertical labor supply curve. C) a perfectly elastic labor supply curve. D) none of the above.
What is the difference between a slowdown in economic growth and a recession?
What will be an ideal response?