If there is a temporary increase in the money supply in the Eurozone, ceteris paribus, what is the result for the United States?
a. The money supply in the United States must decrease by the same proportion.
b. The U.S. dollar nominal interest rate will increase, as the euro rate is unchanged.
c. Long-run expectations shift to expect a stronger euro.
d. The dollar appreciates against the euro.
Ans: d. The dollar appreciates against the euro.
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Which of the following statements is true?
A) Firms usually tend to lay off workers than cut wages to reduce costs. B) Firms tend to increase wages in periods of contracting economic activity to boost morale. C) Firms tend to decrease wages in periods of contracting economic activity to boost labor productivity. D) Firms usually tend to cut wages than lay off people to cut costs.
If the price elasticity of demand is unit elastic, a 10 percent increase in price will result in a 10 percent increase in revenue
Indicate whether the statement is true or false
The average total cost of production
A) equals total cost of production multiplied by the level of output. B) is the extra cost required to produce one more unit. C) equals the explicit cost of production. D) equals total cost of production divided by the level of output.
In calculating gross domestic product, the Bureau of Economic Analysis uses the sum of the market value of final goods and services produced. This means that the BEA
A) values goods at their market prices, multiplies them by the quantity produced, and then adds them up. B) values goods and services at their market prices, multiplies them by the quantity produced, and then adds them up. C) simply counts the total number of goods produced in the market place and then adds them up. D) simply counts the total number of goods and services produced in the marketplace and then adds them up.