If a Thai citizen borrowers dollars for a few months, hedging should take place if
a. the dollar is expected to fall in value over that time
b. the dollar is expected to rise in value over that time
c. the dollar is expected to fluctuate considerably over that time
d. the dollar is expected to remain stable over that time
e. none of the above
A
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The essence of the monetarists view on crowding out is that higher government spending which is not financed by new money creation simply
A) reduces private spending by an equal amount. B) decreases the demand for money. C) increases investment. D) increases aggregate demand in the in the long run.
Under a managed float, if U.S. GDP suddenly increased, which of the following actions would the Bank of England need to take in order to stop any movement in the dollar-pound exchange rate?
a. Buy British pounds for dollars in order to shift the demand curve for pounds leftward b. Sell British pounds for dollars in order to shift the supply curve for pounds leftward c. Sell British pounds for dollars in order to shift the supply curve for pounds rightward d. Buy British pounds for dollars in order to shift the demand curve for pounds rightward e. Do nothing, since purchasing power parity will correct the situation in the short run.
When a tax on a good is enacted,
a. buyers and sellers share the burden of the tax regardless of whether the tax is levied on buyers or on sellers. b. buyers always bear the full burden of the tax. c. sellers always bear the full burden of the tax. d. sellers bear the full burden of the tax if the tax is levied on them; buyers bear the full burden of the tax if the tax is levied on them.
According to supply-side theory, which of the following would cause a rightward shift in the aggregate supply curve?
A. Eliminating government-funded training programs for the structurally unemployed. B. Increasing transfer payments to the unemployed. C. Eliminating job search assistance. D. Lifting trade restrictions.