Which of the following holds true, if goods sell for the same price worldwide when converted to a common currency?
a. A high rate of inflation exists
b. A fixed exchange-rate system exists
c. Purchasing power parity exists
d. The foreign exchange market is in equilibrium
e. Arbitrage opportunities exist
c
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The economy pictured in the figure below has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; B B. recessionary; C C. recessionary; A D. expansionary; A
What are consumption taxes, and what is an example of a consumption tax?
What will be an ideal response?
Economics promotes which of the following as the way to make the best decision?
A) Continue an enjoyable activity up to the point where its marginal benefit equals its marginal cost. B) Continue an enjoyable activity until it is no longer enjoyable. C) Continue an enjoyable activity until you cannot afford to pursue it. D) Continue an enjoyable activity as long as you do not have to pay for it.
Full integration would lower the effective tax rate on capital and, therefore, lead to increased saving.
A. True B. False C. Uncertain