A reduction in net exports, all other things unchanged
A. results in a movement up along the aggregate demand curve.
B. reduces aggregate supply.
C. reduces aggregate demand.
D. does not change aggregate demand or aggregate supply in the domestic economy.
Ans: C. reduces aggregate demand.
You might also like to view...
Suppose real GDP grows at 7 percent per year and the population grows at 2 percent per year. How many years will it take for real GDP and real GDP per person to double?
What will be an ideal response?
Of the three major categories of consumption, ________ is the most volatile because their purchase ________
A) services; is sensitive to income levels B) nondurables; is sensitive to income levels C) durables; can be postponed when incomes decline D) durables; they are necessities
An upward spiral of protectionism is a possible outcome of strategic trade policy
a. True b. False Indicate whether the statement is true or false
Suppose you plan on eating 50 potato chips. As you start consuming potato chips, your marginal utility is very high, but it begins to fall slowly until you’ve eaten 10 chips. After you have eaten 10 chips, your marginal utility decreases even faster with each additional chip. Marginal utility continues to decline until you’ve eaten 49 chips. The fiftieth chip does not give you any additional utility. After 50 chips, your mouth gets so salty that it is unpleasant to eat any more, so marginal utility is actually negative for those chips. How many chips should you eat in order to maximize your total utility?
a. 1 b. 10 c. 49 d. 51