A U.S. federal budget deficit that raises real interest rates is most likely to:
a. lead to a depreciation of the dollar in the foreign exchange market.
b. encourage foreign investment in U.S. securities.
c. lead to an increase in exports.
d. lead to an appreciation of other currencies relative to the U.S. dollar.
e. discourage imports of foreign goods.
b
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When a country's central bank temporarily switches from an expansionary to a more conservative monetary policy, one would expect the exchange rate to:
a. depreciate in the short run, then return to its initial value. b. appreciate in the short run, then return to its initial value. c. depreciate in the short run and then stay higher. d. appreciate in the short run and then stay lower.
Imagine an economy where the government allocates resources among its citizens. Recently, the government divided $1,000 among ten citizens. The amount each citizen received is displayed in the table below
Citizen Amount Received ($) 1 100 2 150 3 50 4 10 5 90 6 200 7 10 8 190 9 20 10 180 a) The government claims that this is an efficient allocation. Do you agree? b) Social workers in the economy criticized the government on the basis of this allocation. What could be the grounds for such criticism?