Which of the following does purchasing-power parity conclude should equal 1?
a. both the nominal and the real exchange rate.
b. the nominal exchange rate but not the real exchange rate
c. the real exchange rate but not the nominal exchange rate
d. neither the nominal exchange rate nor the real exchange rate
Ans: c. the real exchange rate but not the nominal exchange rate
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From 1980 to 2014, the average annual growth rate for the Mexican economy has been 0.8 percent. Based on that growth rate and using the rule of 70, the number of years it will take real GDP per capita to double in Mexico is approximately
A) 9 years. B) 11 years. C) 56 years. D) 88 years.
If a firm hires 312 workers it produces 4,522 computers. If it hires 313 workers it produces 4,786 computers. If computers sell at a constant price of $1 and labor is hired at a constant wage rate of $65 per worker
A) the firm should hire and retain the additional worker. B) the marginal factor cost of labor is $65. C) the marginal revenue product of the added worker is $264. D) all of the above.
If consumers switch away from eating margarine at the same time that the number of margarine suppliers increases, then
a. these two effects cancel each other out and there is no change in the margarine market equilibrium b. the demand curve shifts left and the supply curve shifts right c. there is a margarine price increase d. there is an excess demand for margarine e. the equilibrium quantity of margarine must increase
This graph represents the cost and revenue curves of a firm in a perfectly competitive market.
According to the graph shown, if a firm is producing at Q2:
A. it is producing at an efficient scale. B. average total costs are minimized. C. profits are being maximized. D. All of these are true.