What are the drawbacks of overvaluing the exchange rate as an import substitution policy?
What will be an ideal response?
Discourages exports and leads to trade deficit or to use of exchange controls.
You might also like to view...
Which of the following equations is true of a profit-maximizing firm?
A) Wage = value of worker's marginal product B) Wage = worker's marginal product C) Wage = worker's total product D) Wage = average product of all workers
The investment spending function shows the relationship between investment spending levels and gross national product
a. True b. False Indicate whether the statement is true or false
Comparisons of GDP between developed and underdeveloped countries are often misleading because underdeveloped countries produce
a. a greater share of their total production in the household sector, which understates their GDP relative to developed countries. b. a smaller share of their total production in the household sector, which understates their GDP relative to developed countries. c. a greater share of their total production in the household sector, which overstates their GDP relative to developed countries. d. a smaller share of their total production in the household sector, which overstates their GDP relative to developed countries.
The U.S. unemployment rate has averaged around ______ since 1950.
A. 8% B. 10% C. 6% D. 3%