Describe the background factors that contributed to the Asian financial crisis
What will be an ideal response?
Investors were seeking higher growth and government policies were thought to be very stable and favorable for growth in this region, so there were tremendous capital inflows. Most currencies were pegged to the U.S. dollar and the dollar was appreciating internationally, causing the real exchange rates to be overvalued. Export earnings were damaged by the currency values. These revealed other weaknesses in corporate structures, regulatory systems, and the financial sector, especially in the area of transparency.
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For any new deposits into the banking system, the deposit expansion multiplier provides
A) no useful information regarding the potential expansion of the nation's money supply. B) an exact prediction of the expansion of the nation's money supply. C) a theoretical limit on the potential expansion of the nation's money supply. D) an argument that deposits don't effect the nation's money supply at all.
Normative economic statements
A) are statements of "what ought to be." B) are statements of "what is." C) are statements that may be tested by referring to facts and data. D) do not involve value judgments.
The demand for a cup of coffee is ______________ than is the demand for a dinner at a fancy restaurant because _________________.
A. more price elastic; a cup of coffee requires a smaller portion of one's income. B. less price elastic; a cup of coffee requires a smaller portion of one's income. C. less price elastic; a cup of coffee is more of a luxury. D. more price elastic; a cup of coffee is more of a luxury.
If the CPI was 104 in 1967 and is 390 today, then $10 in 1967 purchased the same amount of goods and services as
a. $2.67 purchases today. b. $37.50 purchases today. c. $39.00 purchases today. d. $104.00 purchases today.