If the price of a Toyota Camry is Y2,000,000 and the price of a Ford Fusion is $20,000, according to the law of one price, the exchange rate between the yen and the dollar should be:

A) Y100 = $1
B) $100 = Y1
C) Y1,980,000=$1
D) the law of one price does not apply since the goods are differentiated

A

Economics

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If the marginal propensity to consume is very close to zero, then the multiplier

A) cannot be calculated. B) is very close to one. C) is very large. D) is very close to zero. E) might be negative if the marginal tax rate is large enough.

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Which of the following is true?

a. Markets determine what goods are going to be produced, but not the distribution of output among members of society. b. Markets determine the distribution of output among members of society, but not what goods are going to be produced. c. Markets determine both what goods are going to be produced and the distribution of output among members of society. d. Government can redistribute income without changing what will be produced in a society.

Economics