When a consumer maximizes utility subject to a limited income, she allocates income across goods to the point that:
a. the marginal price is the same for all goods

When an international financial crisis occurs

A) financial lenders protect their investments by pouring money into the ailing country. B) there are no serious financial effects that last more than a few months. C) financial flows can slow to a trickle, influencing economic growth. D) investors sell off bonds and restrict loans as a mechanism to help the country recover.

Under the fixed rate regime foreign countries could hold their dollar exchange rates constant by

A) using tight monetary policy. B) using expansionary fiscal policy. C) negotiating with the central bank of the United States. D) setting their domestic interest rate equal to the U.S. interest rate. E) holding their exchange rates constantly pegged to the euro and yen.