Which type of exchange rate system minimizes external shocks to an economy?
What will be an ideal response?
A flexible exchange rate system
Economics
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Suppose that the demand for picture frames is highly inelastic, and the supply of picture frames is highly elastic. A tax of $1 per frame levied on picture frames will increase the price paid by buyers of picture frames by
a. less than $0.50. b. $0.50. c. between $0.50 and $1. d. $1.
Economics
Suppose the demand curve and the supply curve in a market are both linear. To begin, there was a $5 tax per unit, and the $5 tax resulted in a deadweight loss of $1,500 . Now, the tax per unit is higher, with the higher tax resulting in a deadweight loss of $6,000 . What is the amount of the new tax per unit?
Economics