When Turkey tried to preserve its fixed exchange rate in the early 2000s, it was unable to do so and its currency depreciated. Which policy would have been most likely to help Turkey preserve the value of its exchange rate?
A. Drop in central bank lending rates
B. Tax cut
C. Drop in the money supply
D. Spending hike
Answer: C
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Which type of unemployment is likely to increase the most during an economy's recession?
a. Frictional unemployment b. Seasonal unemployment c. Structural unemployment d. Cyclical unemployment e. Underemployment
Which of the following statements is not true?
a. If marginal social cost and marginal private cost are the same, any externality that exists will be positive. b. If marginal externality costs are not zero, externalities exist. c. An expansion of property rights to include air quality and scenic beauty would bring some private markets close to a socially optimal equilibrium. d. The existence of pollution as the byproduct of a production or exchange process indicates a market failure. e. When municipal water supplies have heavy concentration of agricultural chemicals, it is probable that agricultural output from the area is produced in quantities greater than the socially optimal level.
Other things being equal, a national health insurance program would
A) decrease the demand for health care. B) decrease moral hazard. C) decrease total health care expenditures. D) reduce individuals' incentives to make decisions that promote better health.
If the price of a good falls by 10% and the total amount consumers spend on the good remains the same, then the good is
A. Unit elastic B. Perfectly inelastic C. Inelastic D. Elastic