When the domestic currency strengthens under a fixed exchange-rate system, this is called
A. a revaluation.
B. a devaluation.
C. an appreciation.
D. a depreciation.
Answer: A
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What will be an ideal response?
The fiscal and monetary policy alternative to fine-tuning is
A) abandonment of both fiscal and monetary policy. B) abandonment of fiscal policy in favor of exclusive reliance on monetary policy. C) budgets established for the long term and a steady growth rate for the money stock. D) price and wage controls. E) redistribution of income in favor of those with a higher propensity to spend.
If a monopsony must negotiate with a union, then the wage will probably be
A) more than the value of marginal product. B) more than the marginal cost of labor. C) the same as if there had been no union. D) more than what it would have been without a union but not more than the value of marginal product.
In the Keynesian framework, as long as output is ________ the equilibrium level, unplanned inventory investment will remain ________, firms will continue to raise production, and output will continue to rise
A) below; negative B) above; negative C) below; positive D) above; positive