Suppose that the 12-month interest rates for the United States and the United Kingdom are 7% and 6% respectively, and E = 2.10 $/£. Given this information, what is the expected exchange rate change over the year?

Incumbents are unaffected by fixed costs of entry while potential entrants are affected by them because

A) for potential entrants the cost is avoidable, while for the incumbent, it is not. B) fixed costs will be greater for the potential entrant than for the incumbent. C) fixed costs are zero for the incumbent. D) incumbents will act to prevent entry at all costs.

Which of the following did not contribute to the farmer's worsening terms of trade during the period of 1875-1895?

a. A rapid increase in the supply of agricultural products. b. Output increases as a result of technological change during the period. c. A rise in demand for U.S. crops after the Civil War. d. The income elasticity of demand for most agricultural crops was less than one.