Which of the following does not cause exchange rate fluctuations?
a. Changes in relative international incomes.
b. Changes in relative international expectations.
c. Central bank interventions in the foreign exchange market.
d. Changes in relative international tax rates.
e. All of the above variables cause exchange rate fluctuations.
.E
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Since a monopoly can set any price it wants, it always makes a profit?
Indicate whether the statement is true or false
The competitive market process tends to promote economic prosperity because it
a. keeps the prices of goods higher than their production costs. b. creates inefficiencies, which causes people to economize. c. directs self-interested action toward the production of goods that are highly valued relative to their cost. d. sends signals to the government about which goods to produce.
The standard definition of "recession" is
A) a period of a positive frictional unemployment rate. B) two consecutive quarters of falling Real GDP. C) the lowest point in a business cycle. D) a period of negative inflation.
In competitive markets, a surplus or shortage will
A. cause changes in the quantities demanded and supplied that tend to intensify the surplus or shortage. B. cause changes in the quantities demanded and supplied that tend to eliminate the surplus or shortage. C. cause shifts in the demand and supply curves that tend to eliminate the surplus or shortage. D. never exist because the markets are always at equilibrium.