A change in which of the following changes the supply of dollars and shifts the supply curve of dollars?
I. an increase in the exchange rate
II. a change in interest rates
III. a decrease in the expected future exchange rate
A) I
B) I and II
C) II and III
D) I, II, and III
C
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Suppose a perfectly competitive industry is in long-run equilibrium. If a decrease in demand leads to a higher long-run price, we know that
A) this is a decreasing-cost industry. B) this is an increasing-cost industry. C) some firms will be losing money in the long run. D) after further adjustments, price will fall to its original level.
Which of the following is not a factor of production?
(a) Labour. (b) Savings. (c) Land. (d) Capital.
Refer to Figure 2-1. Harvey receives his first paycheck for working as an ice cream vendor. To which of the arrows does this transaction directly contribute?
a. B only
b. A and B
c. C only
d. C and D
You spend $150 every month planting flowers in your front yard. Your neighbor has told you that she derives $20 a month in enjoyment from being able to look at your beautiful flowers. Which of the following is true?
A. You should refuse to spend anything on flowers unless your neighbor pays you $20 a month. B. If you took into consideration the benefits your neighbor derived, the efficient level of flower planting would be less than $150 a month. C. If you took into consideration the benefits your neighbor derived, the efficient level of flower planting would be greater than $150 a month. D. You are spending too much on flowers, because your neighbor derives only $20 worth of benefits.