Questions from General Economics

Q: List and describe six costs of inflation.

List and describe six costs of inflation.

Q: How would the following transactions affect U.S. net capital

How would the following transactions affect U.S. net capital outflow? Also, state whether each involves direct investment or portfolio investment. a. An American cellular phone company establishes an...

Q: Would each of the following groups be happy or unhappy if the

Would each of the following groups be happy or unhappy if the U.S. dollar appreciated? Explain. a. Dutch pension funds holding U.S. government bonds b. U.S. manufacturing industries c. Australian tour...

Q: What is happening to the U.S. real exchange rate

What is happening to the U.S. real exchange rate in each of the following situations? Explain. a. The U.S. nominal exchange rate is unchanged, but prices rise faster in the United States than abroad....

Q: Assume that American rice sells for $100 per bushel, Japanese

Assume that American rice sells for $100 per bushel, Japanese rice sells for 16,000 yen per bushel, and the nominal exchange rate is 80 yen per dollar. a. Explain how you could make a profit from this...

Q: A case study in the chapter analyzed purchasingpower parity for several countries

A case study in the chapter analyzed purchasingpower parity for several countries using the price of Big Macs. Here are data for a few more countries: a. For each country, compute the predicted exch...

Q: Purchasing-power parity holds between the nations of Ectenia and Wiknam

Purchasing-power parity holds between the nations of Ectenia and Wiknam, where the only commodity is Spam. a. In 2000 a can of Spam costs 2 dollars in Ectenia and 6 pesos in Wiknam. What is the exchan...

Q: Jennifer divides her income between coffee and croissants (both of which

Jennifer divides her income between coffee and croissants (both of which are normal goods). An early frost in Brazil causes a large increase in the price of coffee in the United States. a. Show the ef...

Q: How would the following transactions affect U.S. exports,

How would the following transactions affect U.S. exports, imports, and net exports? a. An American art professor spends the summer touring museums in Europe. b. Students in Paris flock to see the late...

Q: Would each of the following transactions be included in net exports or

Would each of the following transactions be included in net exports or net capital outflow? Be sure to say whether it would represent an increase or a decrease in that variable. a. An American buys a...