The forward market is:
a. a market that exists only in one place at one time.
b. when a person borrows to speculate in the market.
c. purchases and sales of currencies for delivery at a later time-up to a year.
d. the rate of exchange quoted during the next business day.
Ans: b. when a person borrows to speculate in the market.
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Exponential growth implies that:
A) relatively large differences in growth rates will translate into small differences in the level of a quantity after many years of growing. B) growth rates will alternate between positive and negative values in every consecutive time period. C) relatively small differences in growth rates translates into large differences in the level of a quantity after many years of growing. D) growth rates can only be positive.
According to the law of one price
A) a company can only charge one price for a product, no matter which nation the product is sold in. B) interest rates across nations should be the same when adjusted for exchange rates. C) goods that are easily tradable across nations should sell for the same price expressed in a common currency. D) the price of gold should differ between nations.
The ________ measures the change in the demand of a good due to a percentage change in the consumer's income
A) substitution effect of a price change B) income effect of a price change C) cross-price elasticity of demand D) income elasticity of demand
Refer to Table 9-12. Which country has a comparative advantage in producing swords?
A) Estonia B) Morocco C) both countries D) neither country