Under a system of flexible exchange rates, an increase in demand for a nation's currency in the foreign exchange market will:
a. cause the nation's currency to appreciate
b. make it more expensive for the nation to import goods.
c. cause the nation's balance on current account to shift toward a deficit.
d. make it less expensive for foreigners to buy the nation's goods.
a
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The German central bank gained international reserves in the early 1970s because it sold ________ to prevent mark ________
A) marks; appreciation B) dollars; appreciation C) marks; depreciation D) dollars; depreciation
What to do about inflationary and employment problems in the economy? Conservative economists advocate
a. strong fiscal policy, particularly taxing luxuries b. strong monetary policy, particularly taxing luxuries c. no interference in the private sector d. that to pursue aggressive and consistent policy, the Federal Reserve System should become a department with the executive branch of government e. relying on trends in real business cycles to implement expansionary fiscal policy
Refer to Current and Future Consumption. This consumer can lend and borrow at an interest rate of
The following questions refer to the accompanying diagram, which shows a consumer's choice between current and future consumption.
a. 8%.
b. 25%.
c. 64%.
d. 100%.
You have two options for how to spend the afternoon. You can either go see a movie with your roommate or work as a tutor for the Math Department. From experience, you know that going to see a movie gives you $20 worth of enjoyment, and with your student discount, a movie ticket only costs $12. If you spend the afternoon working as a math tutor, you will get paid $45. On a typical day, you wouldn't be willing to spend the afternoon working as a math tutor for less than $35. What is your economic surplus from working as a math tutor instead of going to the movies?
A. $2 B. $8 C. $22 D. $57