A study using data from the late 1960s showed that black baseball players earned less than comparable white players. Studies of more recent salaries in baseball, however, have found no evidence of discriminatory wage differentials

Bobby faces two choices. The first is to receive $600 on the spot. The other choice is to receive $800 a year from now. The interest rate is 5% per year. What could a possible explanation for Bobby choosing to receive $600 on the spot?

A) Bobby finds that the present value of the $800 a year from now is less than $600. B) Bobby may have time-inconsistent preferences. C) Although Bobby chooses $600 on the spot, he is actually indifferent between the two options. D) None of the above is correct.

Suppose that over the past decade, U.S. inflation is less than that in Mexico. Further assume that during this same period, the dollar depreciates relative to the Mexican peso. Given this information,

A) the real exchange rate remains unchanged. B) the real exchange rate must decrease. C) the real exchange rate must increase. D) the real exchange rate can increase or remain the same, but not decrease. E) the real exchange rate can decrease or remain the same, but not increase.