If domestic returns are greater than foreign returns, then:
a. the spot rate is too high.
b. the spot rate is too low.
c. expectations of future exchange rates will change in the long run.
d. There is no opportunity for arbitrage.
Ans: a. the spot rate is too high.
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Refer to the table below. As the firm increases the number of employee-hours each day from 1 to 2, output increases by:OutputPer DayNumber ofEmployeeHours Per Day00331662994132716511
A. 66 units. B. 33 units. C. 99 units. D. 132 units.
Suppose the United States discovers a way to produce clean nuclear fuel. The effect of this discovery would be to
A) lead the United States to produce less nuclear fuel. B) force the United States to produce at a point inside its PPF. C) shift the U.S. PPF outward. D) shift the U.S. PPF inward.
Assume the demand for money curve is stationary and the Fed increases the money supply. The result is that people:
a. increase the supply of bonds, thus driving up the interest rate. b. increase the supply of bonds, thus driving down the interest rate. c. increase the demand for bonds, thus driving up the interest rate. d. increase the demand for bonds, thus driving down the interest rate.
What happens when marginal product falls in a bicycle factory?
a. The cost of producing one more bicycle rises. b. The average total cost of producing a bicycle falls. c. More bicycles per hour are deemed defective. d. The total number of bicycles produced decreases.