At a constant rate of exchange between currencies, higher inflation makes domestic goods sold abroad ____expensive and, hence, ________ short-run equilibrium output.
A. more; decreases
B. less; increases
C. more; increases
D. less; decreases
Answer: A
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An increase in the average tax rate, with the marginal tax rate held constant, will
A) increase the amount of labor supplied at any real wage. B) not affect the amount of labor supplied at any real wage. C) decrease the amount of labor supplied at any real wage. D) increase the amount of labor supplied at any real wage if the average tax rate is above the marginal tax rate, but decrease the amount of labor supplied at any real wage if the average tax rate is below the marginal tax rate.
Changes in the capital stock occur ________, and changes in the amount of labor that firms employ occur ________
A) quickly; quickly B) slowly; slowly C) slowly; quickly D) quickly; slowly
Last year the price of a dozen eggs was $1, and this year the price is $1.30. Which of the following does NOT express this price change accurately?
A) The price increased 30 percent. B) The price increased by 30 cents. C) If last year was the base year, the index number for this year would be 130. D) If this year is the base year, the index number for last year would be 130.
If Sally Smith creates VCU1 by playing an online game, the effect is to cause the nation's:
a. Monetary base to remain the same. b. M2 money supply to fall. c. M2 money multiplier to fall. d. Monetary base to rise.