A country running a current account deficit over a long time is likely to see its exchange rate:
A. the rate can rise, fall, or hold steady; the current account and the exchange rate are not linked.
B. appreciate.
C. hold steady.
D. depreciate.
Answer: D
You might also like to view...
If the production technology in a Robinson Crusoe economy has increasing returns to scale, there is not competitive equilibrium.
Answer the following statement true (T) or false (F)
A model (or theory):
a. is a general statement about the causal relationship between variables based on facts. b. helps explain and predict the relationship between variables. c. when expressed as a downward (negatively) sloping graph implies an inverse relationship between the variables. d. all of these.
A profit-maximizing firm in a monopolistically competitive industry sells its product at a price:
A. that exceeds marginal cost. B. that exceeds average variable cost. C. equal to average variable cost. D. equal to marginal cost.
The most desirable combination of output attainable with existing resources, technology, and social values is known as the
A. Efficient choice of production. B. Efficient mix of output. C. Attainable mix of output. D. Optimal mix of output.