An exchange rate that is set by official government policy is called a ________ exchange rate.

Suppose the price of gasoline in July 2004 averaged $1.35 a gallon and 15 million gallons a day were sold. In October 2004, the price averaged $2.15 a gallon and 14 million gallons were sold

If the demand for gasoline did not shift between these two months, use the midpoint formula to calculate the price elasticity of demand. Indicate whether demand was elastic or inelastic.

Suppose that population grows by 2 percent annually. For the standard of living to rise, which of the following must occur?

a. Nominal GDP must grow by more than 2 percent. b. Real GDP must grow by more than 2 percent. c. Real GDP per capita must grow by more than 2 percent. d. Consumption spending must grow by more than 2 percent. e. Private investment spending must grow by more than 2 percent.