When the economy is in short-run equilibrium, there will be ________ output gap.
A. only a recessionary
B. no
C. either a recessionary or an expansionary
D. only an expansionary
Answer: C
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In emerging market countries, many firms have debt denominated in foreign currency like the dollar or yen. A depreciation of the domestic currency
A) results in increases in the firm's indebtedness in domestic currency terms, even though the value of their assets remains unchanged. B) results in an increase in the value of the firm's assets. C) means that the firm does not owe as much on their foreign debt. D) strengthens their balance sheet in terms of the domestic currency.
Suppose you purchase a two-year bond that has a $450 coupon and a face value of $5,000, and immediately after you purchase the bond, new bonds are issued that are otherwise identical, except they have coupons of $375
If you sell your bond, the price of your bond will be A) $4,868.07. B) $5,000.00. C) $5,069.76. D) $5,134.67.