Voluntary exchange is based on the principle that all parties must gain from trade
a. True
b. False
Indicate whether the statement is true or false
True
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Define an efficient market
What will be an ideal response?
The expected value of a random variable is:
a. the measure of its variability. b. the most likely outcome. c. the outcome that will occur on average. d. the relative frequency of a realization.
The smaller the quantity and quality of complementary resources used in production,
a. the greater the demand for labor b. the greater the marginal resource cost of labor c. the lower the marginal resource cost of labor d. the lower the marginal productivity of labor e. the greater the marginal productivity of labor
When developing countries borrow in international credit markets, many find that they must borrow in currencies other than their own (such as dollars, yen, or euros). Why are international creditors willing to make loans in dollars, yen, or euros but not in the developing countries' currencies?
A) Lenders are not well-informed about developing countries' economic situations. B) Lenders believe that the currencies of developing countries will always appreciate. C) Lenders receive higher interest rates on loans in dollars, yen, or euros than on loans made in the currencies of developing countries. D) Lenders believe that developing countries have a history of weak macroeconomic management and imprudent monetary and fiscal policies.