What are the economic effects of a currency appreciation?
a. It will decrease aggregate demand and aggregate supply, so that output will certainly fall, and prices may fall as well.
b. It will increase aggregate demand and aggregate supply, so that output will certainly rise, and prices may rise as well.
c. It will increase aggregate demand and decrease aggregate supply, so that prices will certainly rise and output may rise as well.
d. It will decrease aggregate demand and increase aggregate supply, so that prices will certainly fall and output may fall as well.
d
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If the demand for letters written by Abraham Lincoln is higher than the demand for letters written by John Wilkes Booth, what would have to be true for the market equilibrium prices for these letters to be equal?
A) The supply of Lincoln letters would have to be less than the supply of Booth letters. B) The supply of Lincoln letters and the supply of Booth letters would have to be equal. C) If the demand for Lincoln letters is greater than the demand for Booth letters, the market equilibrium price for Lincoln letters will always be greater than the market equilibrium price for Booth letters. D) The supply of Booth letters would have to be less than the supply of Lincoln letters.
In an industry with network effects and differentiated products, it is possible for the industry to become an oligopoly if
A) they engage in a zero-sum game. B) they use a price-leadership model. C) they use a kinked demand curve model. D) a few firms reap most of the sales gains resulting from positive market feedback.