If the interest rate in two countries were the same, you would prefer to invest in assets of the country:
a. whose currency was likely to appreciate
b. whose currency was likely to depreciate.
c. whose currency had the greatest exchange value.
d. none of the above; it would not matter what was likely to happen to a country's currency exchange rate.
a
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If Safeway reduced its grocery prices below cost in a particular metropolitan area and kept them there until all other grocery stores in the area had been forced into bankruptcy, Walmart would almost certainly sustain huge net losses
A) in the short run and the long run because grocery stores would reappear quickly when Walmart subsequently set high prices. B) in the short run but not in the long run because it could charge very high prices afterward. C) in the short run but not in the long run because the policy would lower Walmart's costs of buying from suppliers. D) only if the government enforced the antitrust laws in a fair and even-handed way.
Jonah lives in a small town where there is only one Mexican restaurant. Which of the following is likely to be true about the price elasticity of demand for meals at the Mexican restaurant?
A) Demand is likely to be perfectly elastic. B) Demand is likely to be relatively elastic. C) Demand is likely to be relatively inelastic. D) Demand is likely to be perfectly inelastic.
If the price index was 100 in 2000 and 120 in 2010, and nominal GDP was $360 billion in 2000 and $480 billion in 2010, then the value of 2010 GDP in terms of 2000 dollars would be
A) $300 billion. B) $384 billion. C) $400 billion. D) $424 billion.
Both unemployment insurance and income taxes are examples of
a. economic cycle contributors b. macro consensus c. government regulation d. automatic stabilizers e. tax rates