In the forex, the demand for dollars will decrease if:
A. foreigners wish to buy U.S. goods.
B. foreigners wish to buy U.S. financial assets.
C. interest rates are lower in the U.S. relative to interest rates abroad.
D. interest rates are higher in the U.S. relative to interest rates abroad.
C. interest rates are lower in the U.S. relative to interest rates abroad.
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Suppose that in a market for used cars, there are good used cars and bad used cars (lemons). Consumers are willing to pay as much as $6,000 for a good used car but only $1,000 for a lemon
Sellers of good used cars value their cars at $5,000 each and sellers of lemons value their cars at $800 each. Buyers cannot tell if a used car is reliable or is a lemon. Based on this information, what is the likely outcome in the market for used cars? A) Most used cars offered for sale will be lemons. B) Both good used cars and lemons will sell for $4,500 each. C) Only lemons will sell, for $800 each. D) Both good used cars and lemons will sell for $1,000 each.
The Fed seeks to promote stability of financial markets because
A) resources are lost when there is not an efficient matching of savers and borrowers. B) they want to lift the self-esteem of workers. C) unstable markets result in increased efficiency. D) Congress directed them to do so by the Employment Act of 1946.
Because there is no way to account for them, the official unemployment rate does not include discouraged workers. What would happen to the unemployment rate if, because of a program that gave them new hope, all discouraged workers suddenly begin reporting themselves as ready to work?
a. The official unemployment rate would remain unchanged. b. The size of the labor force would increase. c. The size of the labor force would remain unchanged. d. The official unemployment rate would decrease. e. The size of the underground economy would shrink.
A firm that is operating at a loss may continue to operate for a while because of costs that it will still have to pay even if production ceases
a. True b. False Indicate whether the statement is true or false