When a good is exported from one country to another, the exporting company gets
A. a combination that is half its own currency and half in the currency of the importing buyers.
B. its own currency from buyers in importing country that those buyers have been holding for this circumstance.
C. its own currency because the importer has arranged to get that currency through the foreign exchange market.
D. the currency of the importing country and can only buy goods from the importing country with it.
Answer: C
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Profit functions are homogeneous of degree zero.
Answer the following statement true (T) or false (F)
Suppose that when the price of good X changes, the quantity of good Y demanded remains the same. The cross price elasticity of demand is
A) zero. B) positive. C) negative. D) either positive or negative.
Suppose the price of an ounce of silver is 100 nuevos soles in Peru and $400 in the United States. This implies:
a. the Peruvian nuevo sol is worth four times the value of a U.S. dollar. b. the Peruvian nuevo sol is worth one-fourth the value of a U.S. dollar. c. Peru's economy must be four times larger than the U.S. economy. d. the U.S. economy must be four times larger than that of Peru. e. the U.S. dollar is worth four times the value of a Peruvian nuevo sol.
In the short run, a negative supply shock
a. causes firms' unit costs to decrease b. shifts the AS curve to the right c. causes output to decrease and the price level to increase d. shifts the AD curve to the left e. causes both output and the price level to decrease