A citizen in a developing country with a currency policy of convertibility on the current account could engage in all of the following transactions except:
A. sell foreign currency resulting from the exports of manufactured t-shirts.
B. sell foreign currency resulting from the sale of a U.S. treasury bond.
C. purchase foreign currency in order to import a BMW.
D. purchase foreign currency in order to purchase a U.S. treasury bond.
Answer: D
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In a Bertrand model with identical firms and a non-differentiated product, price will increase in response to
A) an increase in the number of firms. B) a decrease in the number of firms. C) an increase in marginal cost. D) a decrease in marginal cost.
As the housing bubble collapsed, as more foreclosures occurred, and the supply of homes for sale:
A. increased, it further decreased home values, which led to more foreclosures. B. increased, the price of homes fell, and so the demand for homes increased. C. decreased, as homeowners no longer wanted to sell their homes when prices were low. D. decreased, as homeowners refused to sell when they owed more than the market value.
Identify the economist who first addressed the environmental problem in terms of externalities.
A. Joseph Schumpeter B. Maynard Keynes C. A.C. Pigou D. J.B. Say
Which of the following is true of taxes?
A) Taxes drive a wedge between what buyers pay and what sellers receive. B) Business taxes generate government revenue without imposing a burden on consumers and households. C) Increases in taxes are the primary cause of inflation. D) Taxes increase the volume of mutually advantageous exchanges.