Following World War II, the U.S. and most developed countries adopted a system of fixed exchange rates known as:
a. the Heller plan.
b. the new gold standard.
c. the Bretton Woods system.
d. the Geneva accord.
c. the Bretton Woods system.
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Suppose k = 0.25. With a $10 billion decrease in the money supply, the LM curve shifts
A) to the left by $40 billion. B) to the left by $4 billion. C) to the left by $2.5 billion. D) to the right by $0.25 billion.
The use of goods and services for personal satisfaction is known as
A) the law of increasing relative cost. B) specialization. C) comparative advantage. D) consumption.
In the Keynesian view, equilibrium takes place when
a. the real and nominal interest rates are equal. b. the level of total spending in the economy is equal to current output. c. current output is equal to the economy's long-run potential. d. the money supply is growing at a constant rate.
Figure 10-15
The economy's short-run (SRAS ) and long-run (LRAS) aggregate supply curves are shown in , along with three alternative aggregate demand curves and the accompanying equilibrium points. At which point will resource prices naturally tend to decrease?
a.
A
b.
B
c.
C
d.
D