Which of the following is false of perfectly competitive firms?
a. A perfectly competitive market is approximated in highly organized markets for securities and agricultural commodities.
b. The perfectly competitive model does not require any knowledge on the part of individual buyers and sellers about market demand and supply curves.
c. Because perfectly competitive firms are price takers, each firm's demand curve remains unchanged even when the market price changes.
d. In a perfectly competitive market, marginal revenue is constant and equal to the market price.
c
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How does an increase in the relative price of a country's goods in terms of foreign goods, or real exchange rate, affect its balance of trade?
A) An increase in the real exchange rate reduces imports, raises exports, and increases the balance of trade. B) An increase in the real exchange rate raises imports, reduces exports, and reduces the balance of trade. C) An increase in the real exchange rate reduces imports, raises exports, and reduces the balance of trade. D) An increase in the real exchange rate raises imports, reduces exports, and increases the balance of trade.
A one-year Treasury bill with an annual yield of 10 percent and a price of $909.09 has a face value of
A) $900. B) $1,000. C) $980. D) $1,020.