As the dollar price of a euro falls
A. French goods will be less expensive to U.S. residents.
B. U.S. residents will purchase fewer French imports.
C. French residents will increase their purchases of U.S. assets.
D. the quantity of euros supplied will increase.
Answer: A
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Starting from long-run equilibrium, a large tax cut will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; higher B. expansionary; higher; potential C. recessionary; higher; potential D. recessionary; lower; lower
Opponents of government intervention argue that government makes decisions based on:
A. marginal political costs and marginal political benefits. B. marginal social costs and marginal social benefits. C. total costs and total benefits. D. irrational choices.
Economic growth is best defined as
A) decreases in potential GDP. B) increases in potential GDP. C) rightward shifts of the AD curve. D) rightward shifts of the SAS curve.
The network effect in the TV broadcasting industry results in
A) a positive market feedback between the number of advertisers and the size of TV audience. B) a negative market feedback between the number of advertisers and the size of TV audience. C) a positive market feedback between the number of advertisers and the number of TV channels. D) a negative market feedback between the number of advertisers and the number of TV channels.