If the cost of acquiring more information outweighs the benefit of having more information about a good, then we can predict:
A. the exchange will take place, but will be regretted in the future.
B. the exchange will definitely not take place.
C. the exchange may take place anyway.
D. the exchange will not benefit anyone.
Answer: C
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Lower U.S. interest rates cause the value of the dollar to
A) fall, making U.S. goods relatively more expensive on world markets. B) fall, making U.S. goods relatively cheaper on world markets. C) rise, making U.S. goods relatively more expensive on world markets. D) rise, making U.S. goods relatively cheaper on world markets.
What is the optimal level of provision of a public good?
What will be an ideal response?
Supporters of a floating exchange rate cited all of the following as advantages over the Bretton Woods system EXCEPT
A) each country would be able to choose its own long run inflation rate. B) parity changes and speculative attacks would no longer be possible. C) countries would be forced to work cooperatively in deciding monetary policy. D) exchange rates would be set symmetrically in foreign markets rather than by government decision. E) governments would not need to export inflation to decrease domestic unemployment.
The federal government receives most of its revenue from three sources: personal income tax, corporate income tax, and payroll tax.
Answer the following statement true (T) or false (F)