An increase in the foreign interest rate causes the demand for domestic assets to shift to the ________ and the domestic currency to ________, everything else held constant
A) right; appreciate
B) right; depreciate
C) left; appreciate
D) left; depreciate
D
You might also like to view...
The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
Explain what the Saudi oil minister meant when he warned OPEC of using its market power too much by saying "Remember, the Stone Age did not end because we ran out of stones."
What will be an ideal response?
Infant industry protection requires
A) a positive technological externality. B) a national security externality. C) time limited protection. D) Both A and B. E) Both A and C.
The marginal propensity to consume is 0.50, marginal propensity to invest is 0.20, and the marginal propensity to import is 0.05. What is the size of the multiplier?
A) 1.00
B) 2.86
C) 3.00
D) 0.50