Exchange rate expectations:
A. affect exchanges rates and are more important than fundamentals in the short run.
B. affect exchange rates, but only in the long run.
C. affect exchange rates but are not as important as fundamentals in the short run.
D. do not affect exchange rates in the short run or the long run.
Answer: A
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Which of the following is NOT a problem in the implementation of industrial policies?
A) Choosing the industry to target B) Knowing the optimum amount of resources to provide the targeted industry C) The encouragement of rent seeking by firms in other industries D) The benefits are partly captured by foreign firms. E) All of the above are problems.
A decrease in aggregate demand and the subsequent cutbacks in production lead to:
a. frictional unemployment. b. cyclical unemployment. c. cost-push unemployment. d. structural unemployment. e. transitory unemployment.