New Keynesian economics differs from real business cycle economics in that
a. markets are perfectly competitive in new Keynesian models.
b. business cycles are fluctuations in the natural rate of unemployment in new Keynesian models.
c. wages and prices are perfectly flexible.
d. agents maximize utility in the new Keynesian model.
e. none of the above.
E
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If the price of a futures contract increases, then
A) the exchange will collect the amount of the increase from the seller of the contract and transfer it to the account of the buyer of the contract. B) the exchange will collect the amount of the increase from the buyer of the contract and transfer it to the account of the seller of the contract. C) the exchange will collect the amount of the increase from both the buyer and the seller and place it in escrow until the delivery date. D) the additional funds will be required from either the buyer or the seller until the delivery date.
What are the risks to a country of fixing its exchange rate to that of another country?
What will be an ideal response?