Refer to Figure 19-10. Under the Bretton Woods System of exchange rates, if the par exchange rate was $4 per pound in the figure above, then which of the following is true?
A) The Bank of England would have to buy 0.7 million pounds per day with dollars.
B) The par exchange rate is below the equilibrium rate, causing a shortage of domestic currency.
C) There is a shortage of pounds equal to 0.7 million.
D) The Bank of England would have to sell 0.7 million pounds per day in exchange for dollars.
A
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The income earned by the people who sell the services of the factor of production ________ is called ________
A) capital; rent B) entrepreneurship; wages C) land; profit D) entrepreneurship; profit
A state lottery has a Million Dollar Lottery game that pays $1,000 a week for life. Assuming a 6% nominal rate of interest and generously assuming an infinite lifetime, can this game be called a "Million Dollar Lottery"?
What will be an ideal response?