Which of the following statements best describes the circumstances in which exchange rates are beneficial to bank or government borrowing?
a. A bank or government will benefit by borrowing in a domestic currency and lending in a foreign currency, provided the exchange rate does not shift.
b. A bank or government will benefit by borrowing in a foreign currency and lending in a domestic currency works well, provided the exchange rate does not shift.
c. A bank or government will benefit by borrowing in a foreign currency and lending in a domestic currency works well, provided the exchange rate increases.
d. A bank or government will benefit by borrowing in a foreign currency and lending in a domestic currency works well, provided the exchange rate decreases.
b. A bank or government will benefit by borrowing in a foreign currency and lending in a domestic currency works well, provided the exchange rate does not shift.
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Kisa consumes the same amount of cigarettes each week regardless of her income (assume that her income is sufficiently large such that the quantity is affordable). The Equivalent Variation equals the Compensating Variation
Indicate whether the statement is true or false
Graph a and graph b have several differences. What difference between the two shows a failure to meet productive efficiency?
a. In graph a, ATC touches the demand curve at P equals MC.
b. In graph b, the demand curve is downward sloping.
c. In graph a, P equals both MR and MC.
d. In graph b, MC is less than P*, and q* is less than it could be.
Refer to the graph shown. A quantity restriction of QR will:
A. create excess demand represented by Q2 ? QR. B. reduce quantity supplied to Q2. C. reduce quantity supplied to QR. D. have no effect on quantity supplied.
Antitrust laws allow the U.S. government to do all of the following except _____.
(A) Stop firms from selling new products. (B) Watch and regulate industry. (C) Break up existing monopolies. (D) Stop firms from forming monopolies.