For this question, assume that the J-curve effect exists. Which of the following will occur after a real appreciation?
A) The trade deficit will improve temporarily before it worsens.
B) The trade deficit will worsen temporarily before it improves.
C) The real exchange rate will fall temporarily before it rises.
D) The real exchange rate will rise temporarily before it falls.
E) none of the above
A
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There are circumstances under which the corporation tax is equivalent to an economic profits tax.
A. True B. False C. Uncertain
Luke purchases a $50,000 face value one-year Treasury bill for $46,296.30, and the next day investors decide they will only buy one-year Treasury bills if they receive an interest rate of 4%
If Luke decides to sell his Treasury bill to another investor the day after he purchased it, he will A) receive a capital gain of $1,780.62. B) receive a capital gain of $2,000.00. C) suffer a capital loss of $1,923.08. D) suffer a capital loss of $1,851.85.
Why do workers tend to choose low effort levels when they are compensated with fixed wage payments?
A) Workers ignore the cost of effort B) The net compensation after deducting the cost of effort is always higher when the worker provides low effort. C) Workers care more about the stability of income than the level of income. D) Workers tend to be risk averse and tend to choose low-intensity alternatives.
In the days before electronic market transactions, if only a few people had ready access to exchange-rate information, such as knowing the latest on euros per dollar or dollars per Mexican peso, then there was the possibility for
a. market forces to create fixed exchanged rates b. government fixing exchange rates c. arbitrage d. exchange rate controls e. unintentional trade deficits