A bank's off-balance-sheet activities usually:
A. increase its net income but do not change its assets or liabilities.
B. increases a bank's assets but not its liabilities.
C. increases a bank's liabilities but not its assets.
D. increase both its assets and liabilities while reducing net income.
Answer: A
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The change in potential real GDP and aggregate supply shown in the graph above can be a result of
A) a fall in the price level. B) a decrease in the money wage rate. C) an increase in the real wage rate. D) an increase in the quantity of capital. E) a decrease in the money price of oil.
The total variable cost curve increases at a decreasing rate when there are early gains from specialization
Indicate whether the statement is true or false
An increase in the foreign one-year interest rate expected to occur in, say, two years will, all else fixed, have which of the following effects in a flexible exchange rate regime?
A) The real exchange rate will decrease with no change in the nominal exchange rate. B) The nominal exchange rate will decrease with no change in the real exchange rate. C) Both the real and nominal exchange rate will decrease. D) No change in either the nominal or real exchange rate. E) Both the real and nominal exchange rate will increase.
When considering outsourcing, most laypeople:
A. oppose it because of the visible loss of jobs. B. support it because they enjoy lower consumer prices. C. recognize its benefits to raising foreign wages. D. recognize it frees resources for other jobs for which the U.S. has a comparative advantage.