When the Federal Reserve sells securities on the open market it drives bond prices ____ and drives interest rates ____.
A. up; up
B. down; down
C. up; down
D. down; up
D. down; up
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Because of a decrease in the wage rate it must pay, a perfectly competitive firm's marginal costs decrease but its demand curve stays the same. As a result, the firm
A) decreases the amount of output it produces and raises its price. B) increases the amount of output it produces and lowers it price. C) increases the amount of output it produces and does not change its price. D) decreases the amount of output it produces and lowers its price.
Assumptions that underlie the Resource-based View include
a. Resource heterogeneity b. Resource immobility c. Barriers to entry d. Both a and b
The quantity theory of money implies that an increase in the money supply will ultimately:
A. affect only the level of real GDP; the price level will remain unchanged. B. increase the price level and leave real GDP unchanged. C. increase the price level and the level of real GDP. D. decrease the price level and the level of real GDP.
Describe how changes in tastes affect the value of a nation’s currency.
What will be an ideal response?