Other things being equal, an increase in trade restrictions on imports will:
A. increase the demand for foreign currency, causing it to appreciate.
B. increase the demand for foreign currency, causing it to depreciate.
C. reduce the demand for foreign currency, causing it to depreciate.
D. reduce the demand for foreign currency, causing it to appreciate.
Answer: C
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Discuss what is meant by labor market rigidities and explain how they might cause the relatively high unemployment in Europe
What will be an ideal response?
Suppose a farmer is a price taker in soybeans with cost functions given by TC = .1q2 + 2q + 100 MC = .2q + 2 Suppose the farmer has to purchase a license for $50 per period in order to stay in business. In this case, its marginal cost function is
a. still MC = .2q + 2 b. MC = .2q + 50 c. MC = .2q + 52 d. MC = 50