Using the DD model, explain what happens to out put when Government demands increase. Use a figure to explain when it is taking place
What will be an ideal response?
The figure below shows the G1 to G2 raises output at every level of the exchange rate. The change shifts the DD to the right. Which in turns increases output to Y2.
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What's a direct long-run effect of imposing rent controls on apartments?
A) A rise in demand for rent controlled apartments B) A fall in demand for rent controlled apartments C) A fall in the supply of rent controlled apartments D) A rise in the supply of rent controlled apartments
Refer to Figure 19-8. The equilibrium exchange rate is at A, $1.25/euro. Suppose the European Central Bank pegs its currency at $1.00/euro. Speculators expect that the value of the euro will rise and this shifts the demand curve for euro to D2
After the shift, A) there is a surplus of euros equal to 400 million. B) there is a surplus of euros equal to 500 million. C) there is a shortage of euros equal to 800 million. D) there is a shortage of euros equal to 1,000 million.