Refer to the figure above. If the government of China wants to peg the exchange rate above E yuan per dollar:
A) it will have to buy dollars and sell yuan. B) it will have to buy both dollars and yuan.
C) it will have to buy yuan and sell dollars. D) it will have to sell both dollars and yuan.
A
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The intertemporal substitution effect refers to substitution of
A) goods for services. B) goods and services for less expensive goods and services. C) goods and services today for goods and services in the future. D) goods and services produced domestically for goods and services produced in another country.
If demand for good is very inelastic and supply for the good is very elastic a sales tax imposed on sellers will cause the price received by sellers
A) would not change very much. B) would rise by more than the amount of the tax. C) would fall by an amount of the tax. D) would fall by more than the amount of the tax.
Keynesians explain the procyclical behavior of average labor productivity by introducing the concept of
A) menu costs. B) sticky prices. C) labor hoarding. D) sticky wages.
Explain how an increase in the public's taste towards less leisure would affect the labor market, the production function, and aggregate output. Provide graphs to illustrate
What will be an ideal response?