A perfectly competitive industry's short-run supply curve is best described as
A) the upward sloping portion of the industry's marginal cost curve.
B) horizontal.
C) perfectly inelastic.
D) the horizontal summation of the individual firms' supply curves.
D
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The Federal Reserve econometric model estimates that the liquidity effect an increase in the money supply will
A) lower interest rates for 6 months to a year. B) lower interest rates permanently. C) have no effect on interest rates. D) raise interest rates after 6 months to a year.
If Sam's $800 earns him a 6 percent rate of interest, each year he receives
a. $480 b. $48 c. $4.80 d. $80 e. $75
When the nominal exchange rate changes from 4 francs per dollar to 6 francs per dollar, the dollar has:
A. appreciated. B. become undervalued. C. depreciated. D. become overvalued.
Suppose the interest parity condition holds. Also assume that the one-year interest rate in the United States is 6% and that the one-year interest rate in Canada is 6%. What does this imply about the current versus future expected exchange rate (for the U.S. and Canadian dollars)? Explain
What will be an ideal response?