Assume a country is in a fixed exchange rate regime. Explain what factors might cause individuals to expect that a country will revalue its currency
What will be an ideal response?
The currency might be viewed as undervalued. This could be caused by relatively lower rates of inflation in the country. Also, domestic macro conditions (e.g. an expansion) might call for a revaluation.
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You are the manager of a spa you believe one of your suppliers is engaged in cartel activity. As the manager, you ________ an incentive to report the behavior because your spa can ________.
A) do not have; receive treble damages B) have; have to pay whistle -blower fees C) have; receive treble damages D) do not have; have to pay whistle-blower fees
Under a system of flexible exchange rates, in the long run, a nation's balance on current account and capital account transactions will
a. increase continuously. b. decrease continuously. c. tend to net out to zero, indicating a balance between the debits and credits. d. tend to increase if the nation is running a balance of trade surplus and decrease if it is running a balance of trade deficit.
Refer to the figure below.
If a price ceiling were imposed at point G, then producer surplus would be represented by the area ________.
A. DBC B. 0GFQ2 C. DGF D. 0DFQ2
Refer to the above graph, which shows the market for beef where demand shifted from D 1 and D 2. The change in equilibrium from E1 to E 2 is most likely to result from:
A decrease in the tax on beef products An increase in the price of pork A decrease in consumer incomes An increase in the cost of cattle feed