If Japanese tourists visit Yellowstone Park, what is the effect in the foreign-exchange market?
A. It will increase demand for U.S. dollars.
B. It will decrease demand for U.S. dollars.
C. It will increase supply of U.S. dollars.
D. It will decrease supply of U.S. dollars.
Answer: A
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If there is shortage of loanable funds, then
a. the supply for loanable funds shifts right and the demand shifts left. b. the supply for loanable funds shifts left and the demand shifts right. c. neither curve shifts, but the quantity of loanable funds supplied increases and the quantity demanded decreases as the interest rate rises to equilibrium. d. neither curve shifts, but the quantity of loanable funds supplied decreases and the quantity demanded increases as the interest rate falls to equilibrium.
Comparing firms in perfectly competitive markets to monopoly firms, which can earn economic profits in the long run?