Assuming that the central bank is following a money stock targeted, an exogenous rise in investment demand
a. causes income to rise but the money stock has to be increased to accommodate the expansion.
b. has to be accommodated with open market purchases to expand the money stock.
c. increases income, money demand, and lowers the interest rate.
d. increases income and money demand and lowers the interest rate.
e. none of the above.
E
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Which is true about dominant strategies in the game in Scenario 13.15?
A) $80 is dominant for Simple; $70 is dominant for Boring. B) $80 is dominant for Simple; $25 is dominant for Boring. C) $35 is dominant for Simple; $70 is dominant for Boring. D) $35 is dominant for Simple; $25 is dominant for Boring. E) There are no dominant strategies in the above game.
The theory of international exchange that holds that exchange rates are set so that the price of similar goods in different countries is the same is the
A. purchasing power parity theory. B. price feedback theory. C. J-curve theory. D. trade feedback theory.