Which of the following is possible when the market fails?
A. It is impossible for government intervention to improve the mix of goods and services.
B. The mix of goods and services is at the correct point on the production possibilities curve.
C. The mix of goods and services is the optimal mix.
D. The mix of goods and services is on the production possibilities curve.
Answer: D
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In the figure above, if the interest rate is 8 percent, people demand $0.1 trillion
A) less money than the quantity supplied and the interest rate will rise. B) less money than the quantity supplied and the interest rate will fall. C) more money than the quantity supplied and the interest rate will fall. D) more money than the quantity supplied and the interest rate will rise.
China's exchange rate system from 1994 through 2005 is an example of
A) a flexible exchange rate system. B) a fixed exchange rate system. C) a managed float exchange rate system. D) the Bretton Woods System. E) a floating exchange rate system.