Central banks often intervene in currency markets. This activity is called
A) managed floating.
B) fixing exchange rates.
C) currency warfare.
D) super-pegging.
E) flexible floating.
A
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When oil and energy prices rise, the economy tends to experience ________.
A. cost-push inflation B. natural inflation C. demand-pull inflation D. unexpected inflation
Explain how the market for gasoline would react to this price ceiling if a global shortage of oil sent the equilibrium price of gasoline to $3.50 a gal-lon. Would the U.S. gasoline market be efficient?
What will be an ideal response?
A local video store estimates its average customer's demand per year is Q = 7 ? 2P, and it knows the marginal cost of each rental is $0.5. What is the annual profit that the video store expects to make on an average customer if it engages in optimal two-part pricing?
A. $7 B. $9 C. $6 D. $8
Which of the following is true about the output level where marginal revenue equals marginal cost?
A. The firm is maximizing profit. B. The firm should increase its output. C. The firm should reduce its output. D. Economic profits are equal to zero.