An Increase in U

question 22

Multiple Choice

An increase in U.S. interest rates relative to German interest rates would likely ____ the U.S. demand for euros and ____ the supply of euros for sale.​

• A) ​reduce; increase
• B) ​increase; reduce
• C) ​reduce; reduce
• D) ​increase; increase

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Definitions:

Rent Subsidies

Financial assistance provided by the government or other organizations to help individuals or businesses afford the cost of renting property.

Wage Subsidies

Direct financial support from the government to employers or employees to encourage the hiring of workers or to maintain employment levels.

Price Controls

Price Controls are governmental restrictions on the prices that can be charged for goods and services in a market, aiming to curb inflation and ensure affordability.

Binding Minimum Wage

A set wage minimum by the government that is above the equilibrium wage, leading to potential excess supply of labor, or unemployment.