If the 2005 inflation rate in Canada is 4 percent, and the inflation rate in Mexico is 2 percent, then the theory of purchasing power parity predicts that, during 2005, the value of the Canadian dollar in terms of Mexican pesos will
A) rise by 6 percent.
B) rise by 2 percent.
C) fall by 6 percent.
D) fall by 2 percent.
D
Economics
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If in a perfectly competitive industry, the market price facing a firm is below its average total cost but above average variable cost at the output where marginal cost equals marginal revenue
A) the industry supply will not change. B) firms are breaking even. C) some existing firms will exit the industry. D) new firms are attracted to the industry.
Economics
Which of the following would be studied by macroeconomists?
A. Inflation in developing countries. B. The effect of government subsidies on sugar prices. C. The impact of the minimum wage on families below the poverty level. D. The effect of rent controls on housing prices in New York City.
Economics