Carlos Silva, a Colombian singer, goes on tour to the United States for one month, following high American demand for his live shows. Assuming that all the show's expenses are paid by the U.S. promoters, other things equal, the U.S. tour will bring about:
a. a decreased supply of Colombian pesos in the foreign exchange market.
b. an increased supply of American dollars in the foreign exchange market.
c. an increased supply of Colombian pesos in the foreign exchange market.
d. a decreased demand for Colombian pesos in the foreign exchange market.
e. an increased demand for American dollars in the foreign exchange market.
b
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When the economy is operating well below capacity, an increase in spending tends to be reflected primarily in a(n):
a. lower level of employment. b. increase in price. c. lower level of output. d. higher level of output and employment. e. increase in business failures.
Consider the relationship between a kinked demand curve and the corresponding marginal revenue curve. Below the point where the kinked demand curve has its characteristic kink, the marginal revenue curve is
a. positively sloped b. a horizontal line c. a vertical line d. discontinuous e. nonexistent because of the kink