In foreign exchange markets, speculators help:
A. Decrease the influence of the futures market because their trades demand current payments
B. Increase fluctuations in exchange rates because of wild buying and selling
C. Decrease the value of most currencies because they tend to hedge the market
D. Increase international trade because they absorb risk which others do not want to bear
D. Increase international trade because they absorb risk which others do not want to bear
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An economy produces only 1,000,000 computers valued at $2,000 each. Of these, 200,000 are sold to consumers, 300,000 are sold to businesses, 300,000 are sold to the government, and 100,000 are sold abroad. No computers are imported. At the end of the year, the computer manufacturers hold the unsold computers in inventory. What is the value of the investment component of GDP?
A. $0.8 billion B. $0.3 billion C. $0.4 billion D. $0.6 billion
All economic questions arise because we
A) want more than we can get. B) want more than we need. C) have an abundance of resources. D) have limited wants that need to be satisfied.
The importance of international trade in the U.S. economy
A) has been decreasing and is expected to continue to decrease. B) has been decreasing but is expected to start to increase. C) has been increasing and is expected to continue to increase. D) has been increasing but is expected to decrease in the future.
If a regulatory commission sets the regulated price equal to marginal cost for a natural monopoly:
a. losses will result. b. government subsidies will be unnecessary. c. the firm will earn economic profits. d. new firms will want to enter. e. resource use will not be optimal.