What impact does an increase in the price level in the United States have on net exports and why?
A) An increase in the price level decreases net exports by increasing the relative cost of American goods.
B) An increase in the price level increases net exports because higher prices decrease American spending on imports.
C) An increase in the price level decreases net exports because higher prices decrease the value of the dollar.
D) An increase in the price level increases net exports because higher prices lower the value of the dollar.
A
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A government is thinking about increasing the sales tax rate. Should it use static or dynamic tax analysis? Explain why one approach is better than the other
What will be an ideal response?
Which of the following would shift a market labor supply curve to the left?
a. an increase in the wage paid to workers in a competing market b. labor-saving technology c. a change in worker tastes so that workers want to retire later d. an increase in immigration
Oil producers expect that oil prices next year will be higher than oil prices this year. As a result, oil producers are most likely to
A) place more oil on the market this year, thus shifting the present supply curve of oil rightward. B) hold some oil off the market this year, thus shifting the present supply curve of oil leftward. C) place more oil on the market this year, thus increasing the quantity supplied of oil at lower but not higher prices. D) hold some oil off the market this year, thus decreasing the quantity supplied of oil at lower but not higher prices.
Consumption spending is $5 million, planned investment spending is $8 million, unplanned investment spending is $2 million, government purchases are $10 million, and net export spending is $2 million. What is GDP?
What will be an ideal response?