A purchase of foreign assets by a central bank has the same impact on the monetary base as:
A) an open market purchase of government securities
B) an open market sale of government securities
C) an increase in the discount rate
D) a reduction in the interest on reserves
A
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Suppose the nominal price of gasoline was $0.90 per gallon in 1987. To convert this value to the real price of 1987 gasoline in 2012 dollars, we should:
A) multiply by the 1987 CPI and divide by the 2012 CPI. B) multiply by the 2012 CPI and divide by the 1987 CPI. C) not do anything because this is the real price in 2012 dollars. D) none of the above
Country A produces shoes at a lower cost than Country B. As a result, most of the shoes purchased in Country B are made in Country A. Explain how trading with Country A results in a net gain for Country B.
What will be an ideal response?
The elasticity of resource demand measures the:
A. responsiveness of workers to changes in wage rates. B. responsiveness of producers to changes in resource prices. C. ratio of marginal revenue product to resource price. D. sensitivity of marginal revenue product to changes in product price.
Answer the following questions true (T) or false (F)
1. The General Agreement on Tariffs and Trade (GATT) was formed to replace the World Trade Organization (WTO) because the WTO was empowered only to reduce barriers to trade in goods. The GATT is an agreement to reduce barriers to trade in goods, services, and intellectual property. 2. In 1995, the General Agreement on Tariffs and Trade (GATT) was replaced by the World Trade Organization (WTO). 3. Globalization is the process of countries imposing trade restrictions on other countries.