Everything else equal, a decrease in the demand for dollars in exchange for the pesos:
A) will cause the dollars to depreciate against the pesos and will increase the quantity of dollars being traded in the foreign exchange market.
B) will cause the dollars to depreciate against the pesos and will decrease the quantity of dollars being traded in the foreign exchange market.
C) will cause the dollars to appreciate against the pesos and will decrease the quantity of dollars being traded in the foreign exchange market.
D) will cause the dollars to appreciate against the pesos and will increase the quantity of dollars being traded in the foreign exchange market.
B
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Suppose that a developing country devotes extensive resources towards improving the education and skill level of the labor force
How might this help the country avoid a coordination failure? Is this strategy likely to be successful? Why or why not?
Price elasticity of demand measures the
a. change in quantity demanded generated by a change in price b. change in price generated by a change in quantity demanded c. percentage change in the price of a good demanded generated by a percentage change in people's income d. percentage change in quantity demanded generated by a percentage change in price e. percentage change in price generated by a percentage change in quantity demanded
If the price rises and the total amount consumers spend on the good falls to zero, then demand must be
A. perfectly elastic. B. elastic. C. perfectly inelastic. D. inelastic.
When a nation's inflation rate is low, prices tend to
A. increase dramatically. B. remain stable. C. fluctuate daily. D. reduce currency values