An adverse supply shock generally decreases the price level and real GDP.
a. true
b. false
b. false
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If, at the current exchange rate between the dollar and the South African rand of 6.92 rand per dollar, the rand is "undervalued," how do you expect demand and supply in the foreign exchange markets to respond?
A) The supply of the dollar will rise, while the demand for the rand will fall. B) The supply of the dollar will rise, while the demand for the rand will rise. C) The demand for the dollar will rise, while the supply of the rand will fall. D) The demand for the dollar will fall, while the supply of the rand will rise.
Currencies of different countries are traded in the so-called
A) money market. B) foreign exchange market. C) capital account. D) current account.
As general business conditions improve, we would witness the following in the bond market:
A. the bond demand curve shifting left. B. bond prices decreasing. C. the bond supply curve shifting left. D. bond prices increasing.
The credit risk a bank faces is the risk resulting specifically from:
A. the economy entering a recession. B. some of the bank's loans not being repaid. C. the bank experiencing a decrease in deposits. D. interest rates falling.