Which of the following does not impact aggregate demand in the Keynesian model?
a. Changes in the supply of labor
b. Net exports
c. Household consumption
d. Desired business investment demand
e. Government purchases of goods and services
A
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Suppose 60% of U.S. trade is with England and the rest is with Japan. If the dollar rises by 20% against the pound but falls by 20% against the yen, what is the percentage change in the effective exchange rate of the United States?
a. -12% b. -4% c. ±0% d. -8%
The table above presents the production possibilities of Farmer Brown. Use these data to calculate Farmer Brown's opportunity cost of additional beef as Farmer Brown moves from point A to B to C to D
Also use the data to calculate Farmer Brown's opportunity cost of additional wheat as Farmer Brown moves from point D to C to B to A. Based on these costs, does Farmer Brown use resources that are more productive in one activity than the other? Explain your answer.