ECON: MICRO4 (New, Engaging Titles from 4LTR Press)
4th Edition
ISBN: 9781285423548
Author: William A. McEachern
Publisher: Cengage Learning
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Question
Chapter 1, Problem 4.7PA
To determine
a)
The mistake in the statement that, Government revenues will always increase with an increase in the taxes.
Concept introduction:
When one variable varies systematically with another variable.
Capacity of one variable to influence other.
Period of economic decline with low production and demand.
To determine
b)
The mistake in the statement that, we should increase the imports in case of recession.
Concept introduction:
When one variable varies systematically with another variable.
Capacity of one variable to influence other.
Period of economic decline with low production and demand.
To determine
c)
The mistake in the statement that, US steel industry and the entire economy is helped by increasing the tariff on imported steel.
Concept introduction:
When one variable varies systematically with another variable.
Capacity of one variable to influence other.
Period of economic decline with low production and demand.
To determine
d)
The mistake in the statement; to reduce the national debt, US government can sell the gold in Fort Knox at $1200 per ounce.
Concept introduction:
When one variable varies systematically with another variable.
Capacity of one variable to influence other.
Period of economic decline with low production and demand.
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Students have asked these similar questions
If interest rate parity holds between two countries, then it must be true that:
Question 3 options:
The interest rates between the two countries are equal.
The current forward rate is an unbiased predictor of the future exchange rate.
The interest rate differential between the two countries is equal to the percentage difference between the forward exchange rate and the spot exchange rate.
Significant covered interest arbitrage opportunities exist between the two currencies.
The exchange rate adjusts to keep purchasing power constant across the two currencies.
If interest rate parity holds between two countries, then it must be true that:
Question 3 options:
The interest rates between the two countries are equal.
The current forward rate is an unbiased predictor of the future exchange rate.
The interest rate differential between the two countries is equal to the percentage difference between the forward exchange rate and the spot exchange rate.
Significant covered interest arbitrage opportunities exist between the two currencies.
The exchange rate adjusts to keep purchasing power constant across the two currencies.
Suppose the indirect exchange rate for the Canadian dollar is 0.93. Based on this, you know you can buy:
Question 2 options:
$1 U.S. for $1.93 Canadian.
$1 U.S. for $1.08 Canadian.
$1 U.S. for $0.93 Canadian.
$1.93 U.S. for $1 Canadian.
$1.08 U.S. for $1 Canadian.
Chapter 1 Solutions
ECON: MICRO4 (New, Engaging Titles from 4LTR Press)
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