Each of the following would decrease the demand for U.S. dollars, shifting the demand curve for dollars to the left, except:
A. a decrease in real GDP abroad.
B. a decreased preference for U.S.-made goods.
C. a decrease in the real interest rate on U.S. assets.
D. a depreciation of foreign currencies relative to the U.S. dollar.
Answer: D
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The major factor contributing to the depreciation of the dollar in 2007-2008 was:
A) higher U.S. interest rates resulting in lower capital outflows. B) lower U.S. interest rates resulting in higher capital outflows. C) higher U.S. interest rates resulting in higher capital outflows. D) lower U.S. interest rates resulting in lower capital outflows.
Specialization and trade benefits all participants only if: a. They specialize in those things they have both a comparative and absolute advantage in
b. They specialize in those things they have a comparative advantage in, even if they have an absolute disadvantage. c. They specialize in those things they have an absolute advantage in, even if they have a comparative disadvantage. d. Traders have the same opportunity cost of production