The real exchange rate:
A. uses the price level in each country to convert the exchange rate into a value that is in "real" terms.
B. expresses the value of goods in one country in terms of the same goods in another country.
C. is the nominal exchange rate adjusted for purchasing power parity.
D. All of these statements are true.
Answer: D
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All of the following are operating expenses for a bank EXCEPT
A) service charges on deposit accounts. B) salaries and employee benefits. C) rent on buildings. D) servicing costs of equipment such as computers.
When a consumer spends income so that the ratio of marginal utilities (MUs) of all goods purchased equals the ratio of their prices, the consumer is
a. maximizing marginal utility b. spending too much on all goods c. maximizing total utility d. beyond the point of diminishing marginal utility e. behaving in opposition to the principal of rational behavior
Inflation measures the increase in the quantity of goods and services produced from each hour of a worker's time
a. True b. False Indicate whether the statement is true or false
Analysts that favor a fast transition to market economies argue that China's success with a gradual transition is a special case because
A) its trade flows were relatively large. B) so much of its labor force was in agriculture. C) heavy industry already had a strong foothold when the transition began. D) its coastal areas were already relatively well developed.