The practice of buying a foreign currency with one currency then reselling it to buy yet another currency
a. creates disequilibrium in the foreign exchange market
b. is illegal in the U.S.
c. is arbitrage
d. is impossible because the foreign exchange market creates general equilibrium among exchange rates
e. leads to mutually inconsistent exchange rates
C
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During the twentieth century, the market structure of the U.S. economy has
A) become less competitive. B) remained about the same. C) become more competitive. D) become mostly monopolies.
Mrs. Smith is given a government subsidy for an apartment in a public housing project. The apartment
A) is not subject to the principle of rival consumption. B) is not a public good. C) has widespread benefits and concentrated costs. D) is subject to the free-rider problem.
The Hardboard Construction Company hired Bob at $10 an hour, but its output of doll houses only increased by three units a day. Two weeks later, the company purchased an $8 hammer for Bob and output increased by twelve units. Since the hammer increased
the marginal product more than Bob did, and at less cost, Hardboard fired Bob. Is this consistent with the theory of marginal productivity? Why or why not?
A perfectly inelastic demand is one in which the:
A. response to a change in price is immediate. B. demand curve is perfectly vertical. C. measured elasticity is exactly -1. D. demand curve is perfectly horizontal.