In the foreign exchange market where French francs are traded for Japanese yen, a decrease in the interest rate in France is most likely to cause:
a. a decrease in the yen price of the French franc.
b. an increase in the interest rate in Japan.
c. an increase in the yen price of the French franc.
d. an increase in the demand for French francs.
e. an increase in the supply of yen.
a
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Economists use models in order to
A. get around having to deal with actual facts. B. understand real-life events and predict outcomes. C. avoid having to use theories to understand economic conditions. D. help elect political candidates.
An increase in the price a firm receives for its output will lead the firm to:
A. leave output unchanged and earn greater profits. B. reduce output. C. expand output. D. leave output unchanged and earn smaller losses.
Explain the concepts of consumer surplus, producer surplus, and cooperative surplus
What will be an ideal response?
The fact that an economy always returns to the natural rate level of output is known as
A) the excess demand hypothesis. B) the price-adjustment mechanism. C) the self-correcting mechanism. D) the natural rate of unemployment.