The exchange rate is the A) opportunity cost of pursuing a ...

[bucstennis@aim.com]

The exchange rate is the
 
  A) opportunity cost of pursuing a nation's comparative advantage.
  B) price of one country's currency expressed in terms of another country's currency.
  C) ratio between imports and exports.
  D) interest rate that is charged on risk-free international capital flow.

Question 2

Let C represent consumption expenditure, S saving, I gross private domestic investment, G government expenditure on goods and services, and X - M net exports of goods and services. Then GDP equals
 
  A) C + S + G + X - M.
  B) C + S + G - X - M.
  C) C + I + G + X - M.
  D) C + I + G - X - M.

[nmyers]

Answer to Question 1

B

Answer to Question 2

C