8. Question 8 The real exchange rate of an economy _________ when the relative price of non-tradables to tradables _________. 1 point Rises; rises Remains unchanged; rises …
1. Question 1 Suppose the price level in the US is 150 while the corresponding price level in the UK is 100. If the nominal exchange rate is e=2/3£/$, what…
10. Question 10 Suppose the productivity of the non-tradables sector in the Pakistan economy permanently reduces due to a natural calamity while the tradable sector remains unaffected. If all economic…
7. Question 7 The prices of the inputs used for the production of airplanes in United States will be included in which of the two price indices? 1 point …
3. Question 3 During 1980-2008, the Chinese government followed a successful policy of increasing the productivity of the country’s tradable sectors much faster than was the case in the rest…
9. Question 9 In the long run, the relative price of non-tradables to tradables is determined by the rate of growth of money supply. 1 point True False
6. Question 6 The PPP hypothesis implies that the real exchange rate must be equal to which of the following? Select all that apply. 1 point eP/P*, where P…
5. Question 5 Which of the following reasons may account for the failure of the law of one price? 1 point Trade restrictions Transportation costs Imperfect competition…
4. Question 4 Suppose the government of the United States introduces a permanent tax reduction without cutting expenditure over the next several years. The plan will go into effect next…
2. Question 2 During 1960-1990, the cost of a representative basket of goods produced in Japan steadily rose compared to a similar basket of goods produced in the US, when…
