The special drawing right (SDR) is a basket of three currencies: the British pound, the U.S. dollar, and the Japanese yen.
Answer the following statement true (T) or false (F)
False
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The largest portion of discretionary spending is devoted to
A) foreign aid. B) national defense. C) paying federal employees. D) the space program.
The figure above shows the U.S. demand and U.S. supply curves for cherries. In the absence of international trade, cherry farmers would receive ________ per pound of cherries
A) $2.50 B) $1.50 C) $2.00 D) $1.00 E) $0.50
If the Federal Reserve eliminated all reserve requirements the most likely result would be
A) a large number of depository institution failures because they would not have enough liquidity. B) the Federal reserve would be unable to control the money supply. C) banks would no longer be able to clear checks at the Federal Reserve because there would be no required reserves. D) the size of the money multiplier might fluctuate considerably making the Federal Reserve's job of controlling the money supply more difficult.
Refer to Scenario 16.3. Is the current distribution Pareto optimal?
A) Yes. B) No, as Sam has more of both goods. C) No, as it is possible to find a way for Sam to sell tee shirts to Sally (and receive candy in return) that would make both of them better off. D) No, as it is possible to find a way for Sam to sell candy to Sally (and receive tee shirts in return) that would make both of them better off. E) Without knowing the prices of tee shirts and candy we cannot determine if this distribution is Pareto optimal.