Which of the following best explains a government's motive for reducing the value of its currency?
A. Increase the trade balance and prevent the price level from falling further.
B. Decrease the trade balance and prevent the price level from falling further.
C. Increase the trade balance and prevent the price level from rising further.
D. Decrease the trade balance and prevent the price level from rising further.
Answer: A
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Which of the following is not true in the long-run?
a. There are no variable costs. b. There are no fixed costs. c. Total costs equal variable costs. d. Identical firms will make zero profits.
Which of the following activities create a negative externality?
A) cleaning up the sidewalk on your block B) graduating from college C) keeping a junked car parked on your front lawn D) repainting the house you live in to improve its appearance
Trade between two countries can benefit both countries if
A) each country exports that good in which it has a comparative advantage. B) each country enjoys superior terms of trade. C) each country has a more elastic demand for the imported goods. D) each country has a more elastic supply for the exported goods. E) each country produces a wide range of goods for export.
Costs of unemployment include
A) structural unemployment. B) the output lost due to the fact that the economy is not running at full employment. C) reduction in the labor force. D) higher wages.