The law of diminishing marginal utility states that as we consume increasing amounts of a good or service, _________________________.
Fill in the blank(s) with the appropriate word(s).
we derive diminishing utility or satisfaction from each additional unit consumed
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International monetary analysis focuses on
A) the real side of the international economy. B) the international trade side of the international economy. C) the international investment side of the international economy. D) the issues of international cooperation between Central Banks. E) the monetary side of the international economy, such as currency exchange.
Which of the following is NOT a characteristic of monopolistic competition?
A) large number of sellers B) differentiated products C) advertising D) barriers to entry
Contractionary fiscal policy involving federal spending cuts or tax increases can help to reduce the upward pressure on the _____________ level by shifting aggregate demand to the left.
a. trade b. production c. price d. employment
Assume that the central bank lowers the discount to increase the nation's monetary base. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the real exchange rate and monetary base in the context of the Three-Sector-Model? State your answer after the macroeconomic system returns to complete equilibrium. Assume the nominal exchange rate
is stated as: (Domestic currency per foreign currency). a. The real exchange rate rises and monetary base rises. b. The real exchange rate rises and monetary base falls. c. The real exchange rate and monetary base fall. d. The real exchange rate and monetary base remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.