According to the theory of purchasing power parity, whenever a country's price level is expected to fall relative to another country's price level,
A) its currency's real exchange rate relative to the other country's currency should rise.
B) its currency should depreciate relative to the other country's currency.
C) its currency should appreciate relative to the other country's currency.
D) its nominal interest rate should rise relative to the other country's nominal interest rate.
C
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An insurance policy is:
A. the contract that reduces the financial loss associated with some risky event. B. the amount of money a policy holder pays for the insurance policy. C. the amount of money a policy holder receives if a specific loss occurs. D. the probability of loss from a specific event.
Degree of rivalry is
A. low when fixed costs of existing firms are high. B. high when excess capacity of existing firms is low. C. high when fixed costs of existing firms are low. D. high when fixed costs of existing firms are high.
In a market for emission permits, firms that emit over their allowed limits
A. receive a subsidy for the amount of emissions. B. are taxed by the government for the amount of emissions. C. pay a price of these emissions. D. are forced to shut down.
Describe the three major units of the Federal Reserve System and their functions.
What will be an ideal response?