Why are relative price changes important? (3)
What will be an ideal response?
1) for the market mechanism
2) as a market signal
3) to determine the price of one good in comparison with the prices of other goods
You might also like to view...
You have a $500 saving bond. If the nominal interest rate is 10 percent, then the inflation rate must be
A) 10 percent if in real terms you earned $200. B) 10 percent if in real terms you earned $100. C) zero, otherwise you would sell the bond. D) 4 percent if in real terms you earned $30. E) 4 percent if in real terms you earned $70.
The most successful free trade agreements achieve all of the following goals, except:
a. benefiting exporters by increasing exports to member countries. b. increasing the volume of trade without changing the pattern of trade. c. benefiting consumers by making a wider variety of goods available at a lower price. d. stimulating trade creation to allow the benefits of trade to be realized. e. protecting domestic industries from foreign competition.