An increase in the nominal exchange rate, e, defined as the number of units of the foreign currency that one unit of the domestic currency will buy, indicates that the domestic currency has ________ relative to the foreign currency.
A. depreciated
B. become undervalued
C. appreciated
D. become overvalued
Answer: C
You might also like to view...
What is the Hotelling Principle? Have resource prices behaved as the principle predicts?
What will be an ideal response?
Which of the following is not a difference between monopolies and perfectly competitive markets?
a. Monopolies can earn profits in the long run while perfectly competitive firms break even. b. Monopolies charge a price higher than marginal cost while perfectly competitive firms charge a price equal to marginal cost. c. Monopolies choose to produce the quantity at which marginal revenue equals marginal cost while perfectly competitive firms do not. d. Monopolies face downward sloping demand curves while perfectly competitive firms face horizontal demand curves.
If a product has a short-run elasticity of supply equal to zero, then an increase in the demand for the product will:
A. increase price and leave quantity sold unchanged. B. increase price and reduce the quantity sold to zero. C. have no effect on price or quantity sold. D. leave the price unchanged and reduce the quantity sold.
The ________ broadly we define a market, the less difficult it becomes to find ________.
A. more; goods independent of each other B. more; substitutes C. more; complements D. less; substitutes