An oligopolist who sets the price for the industry is a price leader.
Answer the following statement true (T) or false (F)
True
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Holding all else constant, a decrease in the real interest rate on Mexican assets will ________ the supply of dollars in the foreign exchange market and ________ the equilibrium Mexican peso/U.S. dollar exchange rate.
A. increase; decrease B. decrease; increase C. increase; increase D. decrease; decrease
Refer to the above figure. Suppose the U.S. economy is currently operating at point C. Which of the following actions would you recommend to the president of the United States?
A) Engage in contractionary fiscal policy by reducing government spending. B) Reduce taxes to stimulate investment, consumption and net exports. C) Increase government spending while holding taxes constant. D) Reduce the interest rate to stimulate investment minimizing the crowding out effect.
Bill created a new software program he is willing to sell for $200 . He sells his first copy and enjoys a producer surplus of $150 . What is the price paid for the software?
a. $50. b. $150. c. $200. d. $350.
Because the demand for wheat tends to be inelastic, the development of a new, more productive hybrid wheat would tend to
a. increase the total revenue of wheat farmers.
b. decrease the total revenue of wheat farmers.
c. decrease the demand for wheat.
d. decrease the supply of wheat.