The gains or benefits from trade are:
A) A result of more efficient resource utilization.
B) based on different wage rates in different countries.
C) greater when rich nations trade with poor nations.
D) based on the principle of absolute advantage.
Ans: A) A result of more efficient resource utilization.
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Suppose the Fed purchases Treasury securities. Interest rates in the United States will ________ and the U.S. dollar will ________ against foreign currencies
A) decrease; appreciate B) increase; depreciate C) decrease; depreciate D) increase; appreciate
If the demand of U.S. dollars drops sharply
A. the dollar will depreciate in value. B. foreigners holding U.S. assets will suffer tremendous losses. C. Americans will have to pay a lot more for imported goods. D. All of the choices are true.