Use the following table for a hypothetical single-product economy. year units of output price per unit price index (1=100) 1 10 10 100 2 12 20 200 3 15 30 300 4 20 40 400 Refer to the above data. Nominal GDP in year 3 is:

One method that lenders use to mitigate the adverse selection problem is to

A) charge higher interest rates to less creditworthy borrowers. B) monitor closely the behavior of borrowers after a loan is made. C) ration credit. D) provide default insurance.

What would the Bank of England (England's Central Bank) do to raise the value of the British pound in terms of the euro?

a. It would simply announce its desired exchange rate for the British Pound, and the market forces of supply and demand would do the rest. No further action would be necessary. b. It has no influence over the pound exchange rate. c. It would buy British pounds and supply euros in the foreign exchange market. d. It would buy euros and supply British pounds in the foreign exchange market. e. It would sell dollars and buy euros.