In the market for euros, the supply of euros (€) is
A) downward sloping, because lower dollar prices of euros mean that U.S. goods are cheaper to Europeans.
B) downward sloping, because higher dollar prices of euros mean that U.S. goods are cheaper to Europeans.
C) upward sloping, because higher dollar prices of euros means that U.S. goods are cheaper to Europeans.
D) upward sloping, because lower dollar prices of euros means that U.S. goods are cheaper to Europeans.
C
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If a firm lowered the price of the product it sells and found that total revenue did not change, then the demand for its product is
A) perfectly inelastic. B) relatively elastic. C) perfectly elastic. D) unit elastic.
The theory of PPP suggests that if one country's price level rises relative to another's, its currency should
A) depreciate in the long run. B) appreciate in the long run. C) depreciate in the short run. D) appreciate in the short run.