If Spain sells soccer balls to the United States, then Spain:
A. has an absolute advantage over the United States in making soccer balls.
B. has the ability to produce soccer balls at a lower opportunity cost than the United States can.
C. does not have any trade barriers with the US.
D. can produce more soccer balls than the United States given the same resources.
Answer: B
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Differences among nations in real economic growth rates, real interest rates, and inflation rates will each affect the exchange rates among their currencies
a. True b. False Indicate whether the statement is true or false
If nominal interest rates increase:
A. the expected inflation rate must have gone up. B. either the expected inflation rate went down, the real interest rate went down, or both. C. either the expected inflation rate went up, the real interest rate went up, or both. D. the real interest rate must have gone up.