If U.S. citizens decide to purchase more foreign assets at each interest rate, the U.S. real interest rate
a. increases, the real exchange rate of the dollar appreciates, and U.S. net capital outflow decreases.
b. increases, the real exchange rate of the dollar depreciates, and U.S. net capital outflow increases.
c. decreases, the real exchange rate of the dollar depreciates, and U.S. net capital outflow decreases.
d. decreases, the real exchange rate of the dollar appreciates, and U.S. net capital outflow increases.
b
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If the MRP per dollar is greater for labor than that for tools, a producer should spend more money on labor than originally planned and less on tools. How long can he continue this switch in spending? Why?
What will be an ideal response?
Bill's utility function takes the form U(I) = exp(I) where I is Bill's income. Based on this utility function, we can see that Bill is:
A) risk averse B) risk neutral C) risk loving D) He can exhibit two or more of these risk behaviors under this utility function.
Refer to the above table. Suppose the price of the good sold is $3 and the marginal factor cost of labor is $300, how many units of labor will the firm hire?
A) 4 B) 5 C) 6 D) 3
Credit can be described as:
a. money used as a standard of deferred payment. b. savings made available to borrowers. c. fiduciary currency. d. a form of liquid asset. e. bank loans converted into commodity money.