Suppose currency traders believe that in the future, the United States will experience more rapid inflation than will Japan. The traders ______.
a. also believe that the U.S. dollar will soon appreciate in value
b. will buy more U.S. dollars, pushing up the price
c. holding U.S. dollars will convert them to yen, increasing the demand for yen
d. also believe that Japanese consumers will soon demand more U.S. goods
c. holding U.S. dollars will convert them to yen, increasing the demand for yen
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One common measure of the "standard of living" in a nation is ________.
A. real GDP B. population size C. the unemployment rate D. real GDP per capita
Refer to Figure 18.2. The opportunity cost of producing fishing poles in Macadamia is
A) 3/4 of a spear. B) 5/6 of a spear. C) 6/5 spears. D) 4/3 spears.
As the economy enters a strong expansion in which real GDP increases, which of the following occurs?
A) The demand for money decreases and there is a movement upward along the demand for money curve. B) The demand for money increases and there is a movement downward along the demand for money curve. C) The demand for money curve shifts rightward. D) The nominal interest rate falls as the demand for money curve shifts leftward. E) The demand for money curve shifts leftward.
If firms' expectations about the future become pessimistic so that they think future profits will be lower, then
A) aggregate demand decreases and the AD curve shifts leftward. B) aggregate demand increases and the AD curve shifts rightward. C) the quantity of real GDP demanded decreases, and there is a movement up along the AD curve. D) the quantity of real GDP demanded increases, and there is a movement down along the AD curve. E) the aggregate demand curve does not shift, but potential GDP decreases.