If purchasing-power parity holds, when a country's central bank increases the money supply, a unit of money
a. gains value both in terms of the domestic goods and services it can buy and in terms of the foreign currency it can buy.
b. gains value in terms of the domestic goods and services it can buy, but loses value in terms of the foreign currency it can buy.
c. loses value in terms of the domestic goods and services it can buy, but gains value in terms of the foreign currency it can buy.
d. loses value both in terms of the domestic goods and services it can buy and in terms of the foreign currency it can buy.
d
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Starting from an autarky (no-trade) situation with Heckscher-Ohlin model, if Country H is relatively labor abundant, then once trade begins
A) wages should rise and rents should fall in H. B) wages and rents should rise in H. C) wages and rents should fall in H. D) wages should fall and rents should rise in H. E) rent will be unchanged but wages will rise in H.
State banks failed to find a way to print money under the Constitution
Indicate whether the statement is true or false
Refer to Scenario 2.2. What is the effect of the BBP on the equilibrium price of dental care?
A) It unambiguously increases. B) It unambiguously decreases. C) It increases only if supply shifts more than demand. D) It increases only if demand shifts more than supply.
The price of the stock divided by the profits per share of stock is known as the
A) price-earnings ratio. B) dividend. C) yield in percent per year. D) number of shares traded during the day.