Which of the following is not an advantage to a country of choosing to fix its exchange rate against a major currency, rather than choosing a floating exchange rate?
A) Pegging reduces the uncertainty caused by currency fluctuations and thereby simplifies business planning.
B) Pegging allows the country more flexibility in conducting monetary policy.
C) Pegging insures that interest payments stemming from foreign loans do not fluctuate with the value of the currency.
D) Pegging helps avoid inflation in imported goods caused by currency depreciation for countries with significant levels of imports.
B
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Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting upward C. Short-run aggregate supply shifting downward D. Aggregate demand shifting leftward
The efficient transfer price is
a. the upstream division's average cost b. the upstream division's marginal cost c. the downstream division's average cost d. the downstream division's marginal cost
Answer the following questions true (T) or false (F)
1. At a long-run macroeconomic equilibrium, real GDP is always equal to potential GDP. 2. Stagflation occurs when short-run aggregate supply decreases. 3. An increase in government spending will result in an increase in the price level and an increase in real GDP in the long run.
Refer to the following table. At this level of consumption of goods A and B, the consumer: Good AGood BMarginal utility100500Price$20$50
A. could increase total satisfaction for a given expenditure by increasing the consumption of B and decreasing that of A. B. could increase total satisfaction for a given expenditure by increasing the consumption of A and decreasing that of B. C. is maximizing satisfaction for the given expenditure. D. should consume only A.