A Chinese company exchanges yuan (Chinese currency) for dollars. It uses these dollars to purchase scrap metal from a U.S. company. As a result of these transactions, Chinese
a. net exports increase, and U.S. net capital outflow increases.
b. net exports increase, and U.S. net capital outflow decreases.
c. net exports decrease, and U.S. net capital outflow increases.
d. net exports decrease, and U.S. net capital outflow decreases.
d
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If the annual interest rate is 9%, what would you expect to pay for a bond paying a lump sum of $10,000 in two years?
A) $8,417 B) $8,200 C) $10,000 D) $11,881
Keynes and many of his contemporaries believed that money was
a. major importance because the idea of the liquidity trap only came later. b. even more important than fiscal policy. c. little importance and monetary policy of little use as a stabilization tool. d. major importance but of little use as a stabilization tool. e. none of the above.
When the Fed purchases government securities from a commercial bank, the bank: a. automatically becomes poorer
b. loses equity in the Fed. c. receives reserves that can be used to make additional loans. d. loses its ability to make loans.
Figure 6.2 shows the cost structure of a firm in a perfectly competitive market. Suppose the current market price is $6 and the firm produces at a given output level. If the firm's total fixed cost increases due to a new government regulation, the short-run response of the firm should be to:(Note: since the question does not restrict the firm's response to the short run, we can't rule out that the rise in fixed cost will push the firm below the breakeven point and that the firm will exit the industry in the long run, thus
decreasing its current output level.) A. produce its current output level. B. decrease its current output level. C. increase its current output level. D. There isn't sufficient information.