Microeconomics:
What will be an ideal response?
is concerned with individual economic units and specific markets
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Suppose the extra cost for a company to advertize for one extra day each week on a local TV station is $1,500. Then, the company should advertize on that additional day if it can generate total revenue of $1,500 each week
Indicate whether the statement is true or false
Which of the following is not an example of a systematic mistake that people make?
a. When asked to predict how many movie stars he can list, Ed says 200 but when put to the test he can only name 130. b. Susan watched a home improvement show in which a contractor installed a faulty deck which collapsed within 2 years of installation. She is now concerned about the safety of her own deck. c. Kate's manager asks her to work additional hours for which she will be paid her usual hourly wage. Kate weighs the value of her leisure time against the additional wages before responding to her manager. d. Bill has purchased Skillman tools for years and has recently noticed a decline in quality and durability of Skillman tools. Still, when he needs a new drill, he purchases a Skillman brand drill.
If the current €/$ exchange rate is at parity, then the Euro price of a Hollister hoody costing US$125 is:
(a) €155; (b) €165; (c) €125; (d) We need more information to calculate the Euro price.
Answer the following statements true (T) or false (F)
1. The purchasing-power-parity theory holds that exchange rates should equalize the inflation rates among the trading nations. 2. The expectations of speculators in the United States that the exchange rate for the euro will fall in the future will increase the supply of euros in the foreign exchange market and decrease the exchange rate for the euros. 3. If a nation has a balance of payments deficit and exchange rates are flexible, the price or value of that nation's currency in the foreign exchange markets will rise. 4. Fixed exchange rates usually provide more certainty to those engaged in international trade.