The balance of payments constraint refers to the limits on:
A. exchange rate policy imposed by flexible exchange rates.
B. currency convertibility observed in most developing countries.
C. domestic macroeconomic policy, arising from a shortage of international reserves.
D. macroeconomic policy resulting from IMF conditionality.
Answer: C
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Refer to Scenario 2 . What happens to the relative income distribution between the two countries under the conditions in the previous question? Explain
What will be an ideal response?
When choosing the production level for tomorrow you find that at an output of 100 units, the total variable costs are $20,000 and the average fixed cost is only $50 . If the market price is $200, you should:
a. b or e. b. shut down. c. produce more than 100 units. d. produce fewer than 100 units. e. produce where MC = MR.
What component of GDP is particularly volatile over the business cycle and can be targeted by tax cuts?
Suppose an efficient market has been operating with regard to stock in a particular company, and that company announces that its profits were up 50% from the previous period. However, the stock price falls after getting the news on a day when all of the other stocks are barely moving. This is
A. at least potentially consistent with the efficient market hypothesis because investors may have been anticipating 25% gains. B. absolutely illogical. C. at least potentially consistent with the efficient market hypothesis because investors may have been anticipating 75% gains. D. at least potentially consistent with the efficient market hypothesis because investors may have been anticipating those 50% gains.