When a country's ability to maintain its fixed exchange rate is doubted by investors:
A. it may fall under a speculative attack.
B. the exchange rate is likely to spiral upward, out of control.
C. the value of its currency tends to appreciate too quickly.
D. All of these statements are true.
A. it may fall under a speculative attack.
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A country's long-run aggregate supply curve will shift to the left when there is (are)
A) fewer regulatory impediments to business. B) a discovery of new oil reserves in that country. C) a reduction in the labor force. D) a reduction in the money supply.
If Japan gives up ten bushels of rice to produce one bicycle, while the United States gives up five bushels of rice to produce one bicycle, then:
a. the opportunity cost of producing bicycles in the United States is higher than in Japan. b. Japan has a comparative advantage in the production of bicycles. c. the United States has an absolute advantage in the production of rice. d. total output will be highest if the United States specializes in rice and Japan specializes in bicycles. e. total output will be highest if Japan specializes in rice and the United States specializes in bicycles.
Banks create money when they make loans
a. True b. False Indicate whether the statement is true or false
A country's production possibilities boundary shows that
A) when a society combines its resources inefficiently, it cannot produce more of one good without producing less of the other good. B) the supply for goods always exceeds the demand. C) all points inside the boundary are preferred to all points on the boundary. D) when a society combines its resources efficiently, it is always possible to produce more of all goods. E) when a society combines its resources efficiently, it cannot produce more of one good without producing less of the other good.