The equation E$/£ = 2 means that:
a. one dollar buys 2 pounds.
b. one dollar buys 1/2 a pound.
c. 2 pounds buy one dollar.
d. one dollar buys one pound.
Ans: b. one dollar buys 1/2 a pound.
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Airlines often engage in last-minute price cutting to fill remaining empty seats on a flight because this practice will generally
A) discourage rivals from matching price cuts. B) maximize marginal revenue. C) prevent rival airlines from competing in that market. D) increase marginal revenue more than marginal cost.
In what sense is "austerity" an inevitable result of structural adjustment?
What will be an ideal response?
If an individual moves money from a small-denomination time deposit to a demand deposit account
A) M1 increases and M2 stays the same. B) M1 stays the same and M2 increases. C) M1 stays the same and M2 stays the same. D) M1 increases and M2 decreases.
A Phillips curve is
A) the correlation between money growth and the inflation rate. B) the negative correlation between the unemployment rate and the vacancy rate. C) the positive observed correlation between the inflation rate and the nominal interest rate. D) an observed positive correlation between the inflation rate and some measure of aggregate economic activity.