Suppose the U.S. economy is producing at the natural rate of output. A depreciation of the U.S. dollar will cause ________ in real GDP in the short run and ________ in inflation in the short run, everything else held constant
(Assume the depreciation causes no effects in the supply side of the economy.) A) an increase; an increase
B) a decrease; a decrease
C) no change; an increase
D) no change; a decrease
A
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The United States Post Office
A) has a monopoly in the provision of first-class mail service. B) can safely ignore the prices for mail services charged by its rivals such as FedEx and UPS. C) is an example of a monopoly that results from the ownership of a key resource: first class mail service. D) faces no competition for its mail services.
All of the following are market determinants of exchange rates EXCEPT
A) changes in productivity in one country relative to another. B) changes in real interest rates in one country relative to another. C) changes in product preferences between countries. D) changes in the relative prices of goods and services within a country.