Other things the same, if the price level falls, people
a. increase foreign bond purchases, so the dollar appreciates.
b. increase foreign bond purchases, so the dollar depreciates.
c. increase domestic bond purchases, so the dollar appreciates.
d. increase domestic bond purchases, so the dollar depreciates.
b
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Suppose the government imposes a tax in a certain market in order to internalize an externality. This type of policy is based on which of the Ten Principles of Economics?
a. People face trade-offs. b. People respond to incentives. c. Markets are usually a good way to organize economic activity. d. The cost of something is what you give up to get it.
What is the shape of the monopolist's marginal revenue curve?
a. a downward-sloping line that is identical to the demand curve b. a downward-sloping line that lies below the demand curve c. a horizontal line that is identical to the demand curve d. a horizontal line that lies below the demand curve
A country has $40 billion of domestic investment and net capital outflows of -$20 billion. What is the country's saving?
a. -$60 billion b. -$20 billion c. $20 billion d. $60 billion
Higher wage rates allow a person to reduce the hours worked without losing income. This is known as the
A. Law of diminishing marginal utility. B. Law of diminishing marginal leisure. C. Income effect. D. Substitution effect.