Assuming that chicken and beef are substitutes, a decrease in the price of beef, other things being equal, will:
a. decrease the demand for beef. b. increase the demand for chicken.
c. decrease the demand for chicken. d. increase the demand for beef.
c
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The fungibility of money means that
A. the categories people create to organize their expenditures are meaningless in financial terms. B. people often create false distinctions between categories of debt. C. thinking large, one-time expenses should be paid off over a period of time, while everyday expenses should come out of your checking account, is irrational. D. All of these statements are true.
Assume that foreign capital flows into a nation rise due to expected increases in stock market appreciation. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the GDP Price Index and reserves account in the context of the Three-Sector-Model? a. The GDP Price Index rises and reserves account becomes more negative (or less positive)
b. The GDP Price Index falls and reserves account remains the same. c. The GDP Price Index and reserves account remain the same. d. The GDP Price Index rises and reserves account remains the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
A price floor is a legal minimum on the price at which a good or service can be sold
a. True b. False Indicate whether the statement is true or false
If the exchange rate falls, U.S. residents pay
a. more dollars for foreign bonds and get more dollars from interest payments. b. more dollars for foreign bonds but get fewer dollars from interest payments. c. fewer dollars for foreign bonds and also get fewer dollars from interest payments. d. fewer dollars for foreign bonds but get more dollars from interest payments.