Studies of income mobility show
a. many lower-income households remain in the lowest quintile over time.
b. a welfare trap exists over time.
c. many of the lower-income households climb to middle-income and even to upper-income classes over time.
d. those in the highest-income quintile stay there permanently.
c. many of the lower-income households climb to middle-income and even to upper-income classes over time.
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Based on the case study, "Exchange Rates, Auto Prices, and Currency Wars," explain why exchange rates are of critical importance to firms in the automobile industry, and how Japan has benefited from changes in the value of the Yen
What will be an ideal response?
Advocates of flexible exchange rates claim that under flexible exchange rates
A) enhanced control over fiscal policy would allow countries to dismantle their distorting barriers to international payments. B) reduced control over monetary policy would allow countries to dismantle their distorting barriers to international payments. C) enhanced control over monetary policy would allow countries to increase their distorting barriers to international payments. D) enhanced control over monetary policy would allow countries to dismantle their distorting barriers to international payments. E) enhanced control over monetary policy would destabilize exchange rates.
An upscale fusion bistro in a small town charges higher prices for the same menu items at dinner time than at lunch time. Does the bistro necessarily practice price discrimination?
Explain your answer
If there is a combination of strategies in which each player's action is the best response to the actions of other players, then there is
A) a Boyes equilibrium. B) an unstable equilibrium. C) a complementary equilibrium. D) a Nash equilibrium.