Using the UIP equation to determine the spot exchange rate requires a knowledge of:
I. expected future exchange rates.
II. observed rates of interest.
III. expected returns on foreign deposits .
a. I and II
b. II and III
c. I and III
d. I, II, and III
Ans: d. I, II, and III
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As a whole, nations are better off after trade and specialization because
A) nations can consume along their production possibilities curve, which is outside of their consumption possibilities curve. B) nations can consume along their consumption possibilities curve, which is inside of their production possibilities curve. C) nations experience an inward shift of their production possibilities curve. D) nations can consume along their consumption possibilities curve, which is outside of their production possibilities curve.
Under a "cost-plus" system of hospital reimbursement, hospitals have the incentive to _____
a. minimize expenditures b. purchase the most recent high-tech equipment c. release patients early d. shift away from more expensive surgeries
All games involve which of the following?
A. A predictable outcome B. Payoffs C. Full information D. A game master
In general, autonomous spending increases have a lower multiplier effect on real GDP when the economy is open to international trade
a. True b. False Indicate whether the statement is true or false