Low standards reduce production costs and change a nation's comparative advantage
Indicate whether the statement is true or false
FALSE
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When the economy enters into a recession, your employer is ________ to reduce your wages because ________
A) likely; aggregate demand is vertical in the long run B) unlikely; lower wages reduce productivity and morale C) likely; output prices always fall during recession D) unlikely; output and input prices generally fall during recession
If the MPS is 0.1 and the income tax rate is 0.33 the marginal leakage rate for a closed economy is
A) 0.033. B) 0.23. C) 0.43. D) 0.397.
The simple quantity theory of money predicts that changes in
A) the money supply lead to strictly proportional changes in the price level. B) the money supply do not affect the price level. C) the price level lead to strictly proportional changes in velocity and GDP. D) velocity lead to nearly proportional changes in the money supply.
The exchange rate that equates the quantities of currency supplied and demanded in the foreign exchange market is called the ________ exchange rate.
A. market equilibrium value of the B. real value of the C. target value of the D. fixed value of the