A basket of goods costs $800 in the U.S. In Canada the same basket of goods costs 800 Canadian dollars and the exchange rate is 1.25 Canadian dollars per U.S. dollars. In Turkey the same basket of goods costs 2400 lira and the exchange rate is 3 lira per dollar. Which country has purchasing-power parity with the U.S.?

If the government provides a subsidy to producers, what is the effect of this policy in a supply and demand diagram?

A) The demand curve shifts leftward and the price rises. B) The supply curve shifts rightward and the price falls. C) The supply curve shifts leftward and the price falls. D) The supply curve shifts leftward and the price rises. E) The demand curve shifts rightward and the price rises.

An investment of $10,000 promises a payment of $13,000 after six years. If the annual rate of interest is $8%, what is the net present value of the investment?

What will be an ideal response?