Suppose that prices in the United States rise relative to prices in France. We expect that (on the foreign exchange market) the demand for U.S. dollars will __________ and the supply of dollars will __________
A) increase; increase
B) increase; decrease
C) decrease; increase
D) decrease; decrease
C
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In the case of purely flexible exchange rates, a decrease in domestic real income, with constant prices and domestic credit, will lead to
A) an increase in international reserves. B) the depreciation of the domestic currency. C) the appreciation of the domestic currency. D) no change in the value of the domestic currency.
If there is unplanned inventory accumulation there is excess
A) demand for bonds. B) supply of bonds. C) demand for commodities. D) supply of commodities.
In a small country, there are 5,000 people in the labor force and 3,000 people are employed. The labor force participation rate equals
A) 40 percent. B) 60 percent. C) 62.5 percent. D) an undetermined amount given the lack of information.
The presence of adverse selection:
A. reduces the efficiency of markets. B. increases the efficiency of markets. C. does not affect the efficiency of markets. D. makes the buyer less efficient and the seller more efficient.