The foreign exchange market is the market in which
A) foreigners buy U.S. real estate.
B) foreign stocks and bonds are bought and sold.
C) ideas from different countries are exchanged.
D) currencies of different countries are bought and sold.
E) none of the above
D
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Which of the following is NOT a reason why natural GDP might fall as a result of a supply shock?
A) The production function shifts downward. B) There might be a voluntary decline in the supply of labor in response to the decline in real wages. C) The supply of labor is a function of the expected wage rate. D) none of the above
Economy X has just one worker, while Economy Y has 100 workers. Both have the same capital and land resources and produce the same good. If labor specialization occurs in Economy Y, we would expect Economy Y to produce
a. exactly the same quantity of goods as Economy X b. 100 times the quantity of goods as Economy X c. less than 100 times the quantity of goods as Economy X d. more than 100 times the quantity of goods as Economy X e. more inefficiently than Economy X