The combination of expansionary U.S. monetary policy and contractionary U.S. fiscal policy should:
A. raise the exchange rate if prices and income do not change.
B. have an ambiguous effect on the exchange rate if prices and income do not change.
C. not affect the exchange rate if prices and income do not change.
D. reduce the exchange rate if prices and income do not change.
Answer: D
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Which of the following is a function of the lender of last resort?
a. Keeping the velocity of money at a low level b. Reducing the supply of money and loans in an economy c. Providing short-term emergency loans in conditions of financial crisis in an economy d. Increasing the supply of money and the quantity of loans in an economy
Say a monopolist sells in two separate markets, with demand PA = 100 - 2Q and PB = 50 - Q respectively. Marginal costs in both markets are constant and equal to 8. The profit maximizing quantity of output in market A would be
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