Other things the same, which of the following would both make Americans more willing to buy Italian goods?
a. the nominal exchange rate falls, the price of goods in Italy falls
b. the nominal exchange rate falls, the price of goods in Italy rises
c. the nominal exchange rate rises, the price of goods in Italy falls
d. the nominal exchange rate rises, the price of goods in Italy rises
c
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If the nominal interest rate is 4 percent and the real interest rate is 7 percent, then the inflation rate is
a. -3 percent. b. 0.75 percent. c. 3 percent. d. 11 percent.
An appeal to people's sense of civic or moral responsibility will ________ the free-rider problem and lead to a ________ level of contribution to the public good.
A. increase; smaller B. increase; larger C. reduce; smaller D. reduce; larger
If the supply of labor decreases, which of the following events will occur?
A. The wage rate will increase and firms will increase employment up until the point where MRP equals the new wage rate. B. The wage rate will fall and firms will increase employment up until the point where MRP equals the new wage rate. C. The wage rate will fall and firms will decrease employment to the point where MRP equals the new wage rate. D. The wage rate will increase and firms will decrease employment to the point where MRP equals the new wage rate.
Suppose a policy change will generate $100,000 of benefits for low-income families and $120,000 of costs for high-income families. This change can best be described as
A. potentially efficient. B. equitable. C. Pareto efficient. D. inefficient.