Why will using currency devaluations and imposing tariffs be counterproductive to pull the United States out of a recession?
What will be an ideal response?
If the United States devalued the U.S. dollar, then foreigners could afford to purchase more products, and thus U.S. exports would increase. Also, if the U.S. government imposed higher tariffs on foreign products, then U.S. imports would decrease. In theory, the combined effect should lift net exports as U.S. exports increase and U.S. imports decrease. In practice, the outcomes are more uncertain and likely negative. Other nations who trade with the United States are likely to retaliate by imposing higher tariffs on U.S. products, thus reducing U.S. exports. Other nations also may devalue their currency to make their products cost less for U.S. consumers, and thus increasing U.S. imports. In the long run, both the U.S. economy and the economies of its major trading partners are impoverished by competitive rounds of devaluation and higher tariffs as occurred during the Great Depression.
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Indicate whether the statement is true or false
In 2050 it is estimated that the world's most populous country will be:
a. Indonesia b. Japan c. India d. Brazil
Empirical evidence indicates that imposing taxes on polluting emissions by firms
A. has no effect on the amount of pollution emitted. B. does not give the government leeway to regulate more dangerous emissions differently than less dangerous emissions. C. does reduce the amount of pollution emitted. D. discourages firms from investing in new methods of pollution abatement.
Consumer surplus is the area located on the demand and supply graph ________ the equilibrium price point
a. below b. at the same point as c. above d. it is not found on the demand and supply graph