Exchange rates are an effective way to analyze the price of one currency in terms of another currency with ________.
a. distinctive trade-offs and risks
b. exchange rate policy
c. monetary policy
d. the tools of demand and supply
d. the tools of demand and supply
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How do taxation and user charges compare as government revenue sources?
A) Each generates about the same amount of government revenue. B) Revenues from taxation are much greater than revenues from user charges. C) User charges generate much more revenue than do taxes. D) We don't know because the government does not publish revenue figures broken down.
Suppose the price elasticity of supply for soccer balls is 0.3 in the short run and 1.2 in the long run. If an increase in the demand for soccer balls causes the price of soccer balls to increase by 20%, then the quantity supplied of soccer balls will increase by about
a. 0.67% in the short run and 0.17% in the long run. b. 3% in the short run and 1.2% in the long run. c. 6% in the short run and 24% in the long run. d. 66.7% in the short run and 16.7% in the long run.
Explain how the presence of a superstar basketball player can increase the marginal revenue product of the other players on the team.
What will be an ideal response?
Explain how the "invisible hand" makes sure that markets reach equilibrium more quickly than they would if the government sets prices for goods.
What will be an ideal response?