If the U.S. demand for British pounds increases,
a. the dollar price of a British pound will increase
b. the dollar price of a British pound will decrease
c. the exchange rate between dollars and pounds will be out of equilibrium
d. the pound will fall in value against the dollar
e. there will be no change in either the value of the dollar or the pound
A
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Which of the following is likely to be an effect of inflation?
a. An increase in the willingness of lenders to lend money for longer periods b. A decrease in the willingness of borrowers to borrow money for longer periods c. A decrease in the purchasing power of lenders in the economy d. An increase in the willingness of people to buy bonds as a hedge against rising prices e. An increase in the willingness of people to buy physical assets as a hedge against rising prices
If business taxes rise in a large open economy, it causes the current account to ________ and saving to ________.
A. rise; fall B. rise; remain unchanged C. fall; fall D. fall; remain unchanged