In the diagram, the economy's immediate-short-run AS curve is line ______, its short-run AS curve is _____, and its long-run AS curve is line ______.
A. 1; 2; 4
B. 1; 2; 3
C. 2; 3; 4
D. 3; 2; 1
D. 3; 2; 1
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The supply curve shifts rightward from S0 to S2 when the U.S. interest rate ________ and foreign interest rates are unchanged. The supply curve shifts rightward from S0 to S2 when the expected future exchange rate ________
A) falls; falls B) rises; rises C) falls; rises D) rises; falls E) None of the above answers is correct because the factors mentioned lead to movements along the demand curve and not to shifts of the demand curve.
The current international financial system is a managed float exchange rate system because
A) exchange rates fluctuate in response to, but are not determined solely by, market forces. B) some countries keep their currencies pegged to the dollar, which is not allowed to fluctuate. C) all countries allow their exchange rates to fluctuate in response to market forces. D) all countries peg their currencies to the dollar which is allowed to fluctuate in response to market forces.
The aspect of the Second Banking Crisis of the 1930s that distinguished it from the First Banking Crisis was that during the second crisis ___
a. the Federal Reserve finally decided to act as lender of last resort b. the stock market boom finally came to an end with the crash c. banks in all regions of the country failed d. President Roosevelt asked Congress to establish Federal deposit insurance
Long-term contracts:
A. reduce transaction costs and increase flexibility. B. can reduce opportunistic behavior. C. increase transaction costs and increase opportunism. D. increase transaction costs.