Suppose that at the prevailing yen-dollar exchange rate there is an excess demand for dollars. To stabilize exchange rates, the United States might
A. Lower taxes.
B. Raise interest rates.
C. Pursue contractionary monetary policy.
D. Reduce government spending.
Answer: A
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Which of the following would be most likely to increase transaction costs?
a. A new mall opens bringing together area merchants at one location. b. A city ordinance bans large superstores in order to protect small, local businesses. c. A canal is constructed, allowing ships to reduce travel time by 50 percent. d. A website quickly connects new students to people who are seeking roommates.
If in the economy, business saving equals $300 billion, household saving equals $10 billion and government saving equals -$200 billion, what is the value of national saving?
A. $210 billion B. $310 billion C. $110 billion D. $10 billion
If the price of gasoline was $3.25 a gallon and it is now $3.75 a gallon, what is the percentage change in price?
A) 7.1 percent B) 13.3 percent C) 15.4 percent D) 33.3 percent
Using the bathtub analogy to understand what determines the number of unemployed workers, the stock variables are
A) the number of workers finding jobs and the number of workers separating from their jobs. B) the number of workers separating from their jobs and the number of unemployed workers. C) the number of unemployed workers and the number of workers finding jobs. D) the number of workers finding jobs, the number of workers separating from their jobs, and the number of unemployed workers.