Suppose there are two countries (country A and country B) each with its own currency (Currency A and Currency B). Suppose the exchange rate is expressed in terms of amount of Currency A needed to get Currency B. A strengthening of Currency A would show up as
A. an increase in the interest rate.
B. an increase in the exchange rate.
C. a decrease in the exchange rate.
D. a decrease in the interest rate.
Answer: C
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Aggregate demand can be defined as:
a. the total spending by all consumers, business firms, government agencies, and foreigners in the United States. b. the total amounts that all consumers, business firms, government agencies, and foreigners wish to spend on all final goods and services at various price levels. c. the total spending by consumers, business firms, and government agencies in one year. d. the total spending by consumers, business firms, and government agencies on final goods and services.
Medical authorities announced in the late 1980s that an acne medicine named Retin-A also had previously unknown wrinkle-reducing properties. An economist would expect to find that, after this announcement, the price of Retin-A ____ and the quantity sold ____
a. rose; fell b. rose; rose c. fell; fell d. fell; rose
Which of the following causes a shortage of a good?
a. a binding price floor b. a binding price ceiling c. a tax on the good d. None of the above is correct.
What are the three main kinds of unemployment?
A) frictional, seasonal, and cyclical B) structural, frictional, and cyclical C) cyclical, structural, and temporary D) temporary, permanent, and volunteer