When Argentina fixed the exchange rate of their peso to the U.S. dollar, one outcome was:
A. Argentinean central bankers regained control of their domestic interest rate.
B. Argentinean central bankers were finally able to focus their attention on domestic monetary policy.
C. Argentineans began using the U.S. dollar for all of their transactions.
D. Argentinean central bankers effectively gave control of their domestic interest rate to the FOMC.
Answer: D
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The principle of diminishing marginal utility implies that the
A) marginal utility of a product is negative. B) total utility from a product is also diminishing as more units are consumed. C) rate of change of total utility is diminishing as more units are consumed. D) rate of change of marginal utility is very low as more units are consumed.
The income distribution in less-developed nations tends to be
a. more uneven than in developed economies b. less uneven than in developed economies c. similar to that in developed economies d. impossible to calculate e. not comparable because tax structures differ among countries
How does the discovery of new resources affect trade patterns around the world?
If a consumer allocates her income between two goods, x and y, then she will be in equilibrium when
a. MUx/Px = MUy/Py and she is below her budget constraint b. MUx = MUy and she has spent all of her income c. MUx/MUy > Px/Py and all of her income is spent d. MUx/Px = MUy/Py and all of her income is spent e. MUx = MUy and she is below her budget constraint