If speculators believe a currency is undervalued, their trades in international exchange markets will
A) increase the surplus of the currency at the existing fixed exchange rate.
B) increase the shortage of the currency at the existing fixed exchange rate.
C) decrease the shortage of the currency at the existing fixed exchange rate.
D) decrease the surplus of the currency at the existing fixed exchange rate.
B
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Assume that for a particular firm's output price = $80, marginal cost = $30, average total cost = $25. This information suggests that the firm in question has:
A) no market power. B) very little market power. C) a fair degree of market power. D) absolute market power.
The optimal hiring rule is to employ labor up to the point where:
a. wage = MFC. b. wage = MP. c. wage = MR d. wage = MRP e. wage = TWC.
Concepts useful in evaluating the costs and benefits of alternative types of taxes are:
A. efficiency, incidence and scarcity. B. revenue, scarcity, and shortage. C. incidence, scarcity, and shortage. D. efficiency, revenue and incidence.
The main problem with a regulatory commission setting P = ATC is that the regulated firm will
a. experience a loss b. find its demand curve shifting to the left c. earn economic profits d. refuse to make new purchases of capital e. have little incentive to keep costs down