According to purchasing-power parity, if over the course of a year the price level in the U.S. rises more than in Canada, then which of the following rises?
a. the U.S. real exchange rate, but not the U.S. nominal exchange rate
b. the U.S. nominal exchange rate, but not the U.S. real exchange rate
c. the U.S. nominal exchange rate and the U.S. real exchange rate
d. neither the real exchange rate nor the nominal exchange rate
d
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Assuming an increase in money demand, then if the Federal Reserve
a. can keep the interest rate unchanged assuming that it changes the monetary base by the appropriate amount. b. would have to aim below their previous money stock target. c. would not have to cut taxes to keep output from falling. d. All of the above e. None of the above
Refer to the information below. What is the vertical intercept of the demand curve?
A small nation has three gasoline suppliers with a linear monthly market demand equal to: Q = 500,000 - 5P. Each firm's marginal cost (MC) and average total cost (ATC) curves are horizontal at $10,000 per month. A) 0.50 B) 100,000 C) 0.20 D) 500,000
Which of the following would NOT be official reserves for Germany?
A) U.S. dollars B) the official currency of Germany C) gold D) SDRs
Assume that the central bank increases the reserve requirement. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the real GDP and net nonreserve-related international borrowing/lending in the context of the Three-Sector-Model?
a. There is not enough information to determine what happens to these two macroeconomic variables. b. Real GDP falls, and net nonreserve-related international borrowing/lending becomes more positive (or less negative). c. Real GDP rises, and net nonreserve-related international borrowing/lending becomes more positive (or less negative). d. Real GDP rises, and net nonreserve-related international borrowing/lending becomes more negative (or less positive). e. Real GDP falls, and net nonreserve-related international borrowing/lending becomes more negative (or less positive).