Exchange rate fundamentals, such as the income level, interest rates, and the price levels,:
A. affect exchange rates, but only in the short run.
B. affect exchange rates but are not as important as expectations in the long run.
C. do not affect exchange rates in the short run or the long run.
D. affect exchange rates and are more important than expectations in the long run.
Answer: D
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Which of the following are important for countries to promote with property rights and incentives if economic growth is to occur? i. specialization ii. saving and investment iii. increases in human capital iv. discovery of new technology
A) i, ii, iii and iv. B) ii and iii. C) iii and iv. D) ii and iv. E) i, ii and iv only.
In the short run, producers derive surplus from market exchange because
a. total revenue is greater than the minimum they would require to sell the good b. total revenue is equal to the minimum amount they would require to sell the good c. total revenue is less than the minimum amount they would require to sell the good d. marginal revenue equals average revenue e. they can rob consumers of most of their consumer surplus
Explain the difference between adverse selection and moral hazard?
The introduction of word processing software that increases the demand for workers with computer skills relative to those without such skills is an example of:
A. skill-biased technological change. B. the diminishing marginal product of labor. C. increasing reservation prices. D. globalization.