When the real exchange rate rises
A) imports measured in terms of domestic output will rise.
B) imports measured in terms of domestic output will fall.
C) imports measured in terms of domestic output will never be affected.
D) imports measured in terms of domestic output may rise or fall.
E) imports measured in terms of foreign output will rise.
D
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Switzerland has experienced the lowest rate of price increases in the post World War II period. Consequently, Lucas would predict
A) small supply responses to variations in the inflation rate. B) large supply responses to variations in the inflation rate. C) small demand responses to variations in the inflation rate. D) large demand responses to variations in the inflation rate.
Assume that coal is a normal good. If the price of coal increases and the quantity sold increases, which of the following is consistent with these observations?
What will be an ideal response?
If a union is able to successfully lobby Congress to limit imports of rival products, and thus to raise the demand (and thus price) for the goods or services they make, then which of the following best describes the outcome?
A. The supply of labor will increase. B. The demand for labor will increase. C. The supply of labor will decrease. D. The demand for labor will decrease.
An increase in dividend payments will
A. lead to a decrease in labor supply. B. either lead to an increase or decrease in labor supply depending on the relative magnitude of the income and substitution effects. C. have no effect on labor supply. D. lead to an increase in labor supply.