The purchasing power parity hypothesis implies that an increase in inflation in one country relative to another will over a long period of time
a. increase exports
b. reduce the competitive pressure on prices
c. lower the value of the currency in the country with the higher inflation rate
d. increase foreign aid
e. increase the speculative demand for the currency
c
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The law of increasing costs states that
A. opportunity costs decrease as more of one good is produced. B. increasing resource prices are inevitable because of scarcity. C. opportunity costs increase as more of one good is produced. D. resources can be easily adapted to the production of any good
If the economic profit generated by a firm is zero and its implicit costs are greater than zero, then
A. accounting profit is also zero. B. accounting profit is less than zero. C. new firms will enter the industry. D. accounting profit is greater than zero.
A permanent increase in the domestic money supply
A) must ultimately lead to a proportional decrease in E, and, therefore, the expected future exchange rate must rise proportionally. B) must ultimately lead to a proportional decrease in E, and, therefore, the expected future exchange rate must decrease proportionally. C) must ultimately lead to a proportional rise in E, and, therefore, the expected future exchange rate must rise proportionally. D) must ultimately lead to a proportional rise in E, and, therefore, the expected future exchange rate must rise more than proportionally. E) must ultimately lead to a proportional rise in E, and, therefore, the expected future exchange rate must rise less than proportionally.
For which of the following market structures is it assumed that there are barriers to entry?
A) Perfect competition B) Monopolistic competition C) Monopoly D) all of the above E) B and C only