For the law of one price to hold, all of the following are necessary EXCEPT A....
For the law of one price to hold, all of the following are necessary EXCEPT
A.
transportation costs must be negligible.
B.
exchange rates must be fixed.
C.
traded goods must be homogeneous.
D.
all goods and services must be tradable.
E.
tariffs must not be levied by any country.
Homework Answers
Answer : Option D [ All goods and service must be tradable ]
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For the law of one price to hold, all of the following are
necessary EXCEPT
A....
All of the following statements about price are true except which? A. The price for a...
All of the following statements about price are true except which? A. The price for a product or service must earn a profit for the company. B. The price must generate enough sales dollars to pay for the cost of developing, producing, and marketing the product. C. For most products and services, there is an agreed-upon price range set by makers. D. Small changes in price can have big effects on both the number of units sold and company profit....
8) The price of one currency in terms of another is called A) the terms of...
8) The price of one currency in terms of another is called A) the terms of trade. C) purchasing power parity B) a currency band D) the exchange rate. 19) -- exchange rates are either held constant or allowed to fluctuate( ) only within very narrow boundaries, A) managed float exchange rate system B) Freely exchange rate system ) pegged exchange rate system D) fixed exchange rate system : ------- Is the replacement (Jap) of a foreign currency with U.S...
All of the following topics, except one, are valid macroeconomic topics. Which one is the exception?...
All of the following topics, except one, are valid macroeconomic topics. Which one is the exception? Select one: a. the effect of the government budget deficit on inflation b. the reasons the labour force in a country decreases c. the reasons the average price level in a country falls d. the cause of increasing unemployment O e the reasons the price of coffee fluctuates Suppose we observe a rise in the price of good A and an increase in the...
All the following statements are true for ADRs except: they depend on exchange rate movements in...
All the following statements are true for ADRs except: they depend on exchange rate movements in addition to other factors a. they always trade at a discount or premium over their original securities adjusted for exchange rates olb. they are registered foreign securities traded in the U.S. C. they are taxable securities d.
3,4 QUESTION 3 PPP fails in reality for all the following reasons except what? O A....
3,4
QUESTION 3 PPP fails in reality for all the following reasons except what? O A. Transportation costs OB. Trade barriers OC. Monopolistic or oligopolistic competition in goods markets D. Differences in inflation QUESTION 4 cheng, Sen... P Homework and Te... P 202 Homework an Remaining Time: 58 minutes, 39 seconds. Question Completion Status: B. Trade barriers C. Monopolistic or oligopolistic competition in goods markets o D Differences in inflation QUESTION 4 Suppose a basket of goods costs $50 in...
What is the "law of one price," where the price for identical products in different countries...
What is the "law of one price," where the price for identical products in different countries should be the same if trade barriers are absent? a. Purchasing power parity b. Fixed exchange rate policy O C. Balance of payments d. Currency swap
(1) If the world price is above the domestic equilibrium price, the domestic country is likely...
(1)
If the world price is above the domestic equilibrium price, the
domestic country is likely to ____________________ the good.
(2)
The difference between what an economy sells to and buys from
foreigners is _________________.
(3)
The idea that exchange rates and prices adjust to equalize the
cost of living across international boundaries is called
__________________________.
(4)
In the graph below, when the world price is $3, how many units
are...
20. When a country's exchange rate depreciates, the price of: A: that country's goods abroad decreases...
20. When a country's exchange rate depreciates, the price of: A: that country's goods abroad decreases B: that country's goods abroad increases C: foreign goods sold in the country increases D: that country's goods produced and sold locally increases 21. A central bank may seek to influence its country's currency by: A: imposing limits on the number of goods that may be imported B: restricting the outflow of funds from the home country C: intervening directly in the FX market...
Which of the following statement is incorrect? Select one: a. Most of the answers are correct....
Which of the following statement is incorrect? Select one: a. Most of the answers are correct. b. One type of currency control measures is imposing ceilings on direct foreign investment outflows. c. A stable exchange rate, an independent monetary policy, and capital market integration are the three goals of the economic policy makers in any country. d. In a fixed exchange rate system, market forces of supply and demand determine exchange rates. e. A gold standard provides price stability because...
The "perfect information" assumption of perfect competition includes all of the following except one. Which one?...
The "perfect information" assumption of perfect competition includes all of the following except one. Which one? Select one: a. Consumers know their preferences. b. Consumers know their income levels. c. Consumers know the prices available. d. Consumers can anticipate price changes. e. Firms know their costs, prices and technology.
8) The price of one currency in terms of another is called A) the terms of trade. C) purchasing power parity B) a currency band D) the exchange rate. 19) -- exchange rates are either held constant or allowed to fluctuate( ) only within very narrow boundaries, A) managed float exchange rate system B) Freely exchange rate system ) pegged exchange rate system D) fixed exchange rate system : ------- Is the replacement (Jap) of a foreign currency with U.S...
All of the following topics, except one, are valid macroeconomic topics. Which one is the exception? Select one: a. the effect of the government budget deficit on inflation b. the reasons the labour force in a country decreases c. the reasons the average price level in a country falls d. the cause of increasing unemployment O e the reasons the price of coffee fluctuates Suppose we observe a rise in the price of good A and an increase in the...
All the following statements are true for ADRs except: they depend on exchange rate movements in addition to other factors a. they always trade at a discount or premium over their original securities adjusted for exchange rates olb. they are registered foreign securities traded in the U.S. C. they are taxable securities d.
3,4
QUESTION 3 PPP fails in reality for all the following reasons except what? O A. Transportation costs OB. Trade barriers OC. Monopolistic or oligopolistic competition in goods markets D. Differences in inflation QUESTION 4 cheng, Sen... P Homework and Te... P 202 Homework an Remaining Time: 58 minutes, 39 seconds. Question Completion Status: B. Trade barriers C. Monopolistic or oligopolistic competition in goods markets o D Differences in inflation QUESTION 4 Suppose a basket of goods costs $50 in...
What is the "law of one price," where the price for identical products in different countries should be the same if trade barriers are absent? a. Purchasing power parity b. Fixed exchange rate policy O C. Balance of payments d. Currency swap
(1)
If the world price is above the domestic equilibrium price, the
domestic country is likely to ____________________ the good.
(2)
The difference between what an economy sells to and buys from
foreigners is _________________.
(3)
The idea that exchange rates and prices adjust to equalize the
cost of living across international boundaries is called
__________________________.
(4)
In the graph below, when the world price is $3, how many units
are...
20. When a country's exchange rate depreciates, the price of: A: that country's goods abroad decreases B: that country's goods abroad increases C: foreign goods sold in the country increases D: that country's goods produced and sold locally increases 21. A central bank may seek to influence its country's currency by: A: imposing limits on the number of goods that may be imported B: restricting the outflow of funds from the home country C: intervening directly in the FX market...
The "perfect information" assumption of perfect competition includes all of the following except one. Which one? Select one: a. Consumers know their preferences. b. Consumers know their income levels. c. Consumers know the prices available. d. Consumers can anticipate price changes. e. Firms know their costs, prices and technology.
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