What will happen to a country that fixes the price of foreign exchange below equilibrium?
If foreign exchange is priced below equilibrium, then the domestic currency is overvalued. When the price of foreign exchange is fixed below equilibrium, the quantity of foreign exchange demanded by domestic citizens will exceed that supplied by foreigners. A shortage of foreign exchange will result, and a black market will develop where domestic citizens attempt to buy foreign currency with which to conduct foreign exchange. The fixing of exchange rates will limit the citizens' ability to gain from trade.
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The option-value principle can be roughly stated as "more choices can't make a person worse off.". Are there any exceptions to this rule? Choose all that apply. a. No
b. Yes, in strategic situations. c. Yes, in situations involving self-control. d. Yes, for certain complicated financial derivatives.
Compared with a perfectly competitive firm in long-run equilibrium, a monopolistically competitive firm will operate on the upward-sloping portion of the average-total-cost curve
a. True b. False Indicate whether the statement is true or false
Who is most likely to face the highest finance charges?
A) a customer who pays bills online B) an employed individual who makes timely payments C) a person who pays off a credit card balance each month D) a person with a bad credit history and a lot of debt
As of December 31, 2010, the assets listed on the balance sheet of Bank A were $1.5 million in cash reserves and $6 million in outstanding loans to its customers. Its liabilities totaled $6.5 million in checking deposits. What was the bank’s net worth on that date?
A. $1 million B. $4.5 million C. $5 million D. $14 million E. Zero