How do the fluctuations in the exchange rate influence the domestic price level?
When a currency depreciates the prices of imported inputs will rise. The domestic aggregate supply curve therefore shifts inward, pushing up the prices of domestically made goods and services. By exactly analogous reasoning, an appreciation of the a currency makes imported inputs cheaper and shifts the domestic aggregate supply curve outward, thus pushing domestic prices down.
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The contribution to output growth of technological progress is estimated by how much of the output growth can be explained by the growth in inputs
Indicate whether the statement is true or false
All of the Newly Industrializing Economies are in East Asia
Indicate whether the statement is true or false
As the price level rises, ceteris paribus, people holding some of their wealth in monetary form become
A) less wealthy and they buy less. B) more wealthy and they buy more. C) less wealthy and they buy more. D) more wealthy and they buy less.
If there is an unanticipated increase in aggregate demand, which of the following is most likely to occur?
What will be an ideal response?