Use a model of the dollar-euro foreign exchange market to illustrate how the value of the dollar is determined in terms of the euro. Identify two factors that would increase the value of the dollar in terms of the euro.
What will be an ideal response?
See Figure 36.1 in your text for the model. The value of the dollar in exchange markets is determined by the market forces of supply and demand. The value of the dollar might increase in terms of the euro if European businesses purchase more U.S. goods and services (increasing the demand for dollars) or if the interest rate in the United States increases relative to the interest rate in Europe.
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In the 1990s the United States' economy generated more than _______ million additional jobs.
A. 5 B. 10 C. 15 D. 20
The Business Cycle Dating Committee, a part of the ________, officially decides when a recession begins and ends
A) National Bureau of Economic Research B) federal government C) Bureau of Labor Statistics D) Federal Reserve
People:
A. often have good enough information to make acceptable choices. B. always have enough information to make acceptable choices. C. always have access to complete information. D. never have access to complete information.
Moral hazard is
A. The abuse of the welfare system by some nonneedy recipients. B. The involvement in illegal activity. C. An incentive to engage in undesirable behavior. D. The risk involved in accepting welfare.