If a dollar is more expensive in terms of a foreign currency than the equilibrium exchange rate, a ____ exists at the current exchange rate that will put ____ pressure on the exchange value of a dollar
a. surplus of dollars; downward
b. surplus of dollars; upward
c. shortage of dollars; downward
d. shortage of dollars; upward
a
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Price ceilings lead to market surpluses.
Answer the following statement true (T) or false (F)
Economic efficiency occurs when the firm produces a given output
A) by using the least amount of inputs. B) by using the maximum amount of inputs. C) at the least cost. D) at the greatest cost.
If all persons had identical preferences and productivity factors (ability, skill level, education, experience, etc.), the highest paying jobs would be the most
a. prestigious. b. convenient. c. undesirable. d. easily learned.
Lower transaction costs are a benefit of fixed exchange rates. Therefore, relative prices in two trading nations linked by fixed exchange rates should:
A) experience more price divergence. B) experience more price convergence. C) have less arbitrage and more speculation. D) have lower costs of production.