Holding all else constant, an increase in the preferences of Americans for Mexican goods will ________ the supply of dollars in the foreign exchange market and ________ the equilibrium Mexican peso/U.S. dollar exchange rate.

The law of demand implies, holding everything else constant, that as the price of yogurt

A) decreases, the quantity of yogurt demanded will decrease. B) increases, the demand for yogurt will increase. C) increases, the quantity of yogurt demanded will decrease. D) decreases, the demand for yogurt will increase.

In many developing countries, starting a business involves navigating a labyrinth of rules and regulations and red tape. Paying a bribe to expedite paperwork is a common practice

As Samuel Huntington puts it—"the only thing worse than a society with a rigid, overcentralized, dishonest bureaucracy is one with a rigid, overcentralized, honest bureaucracy." The argument is that bribes increase economic activity because, without bribes to grease bureaucrats' palms, starting a business would be an extremely long, drawn-out process and would probably drive investors away. Is this always the case, or does bureaucratic corruption involve other costs? Explain your answer.