What is the most likely effect when the price level in the United States rises relative to the price level in other countries, ceteris paribus?
a. U.S. exports decrease, and U.S. imports increase.
b. U.S. exports and U.S. imports both decrease.
c. U.S. exports increase, and U.S. imports decrease.
d. U.S. exports and U.S. imports both increase.
a. U.S. exports decrease, and U.S. imports increase.
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Which of the following distinguishes corporations from the other forms of business organization?
a. Corporations can issue stock. b. Corporations are permitted to operate in other countries. c. Corporations can produce more than one product. d. Corporations can offer both products and services. e. Corporations are subject to unlimited liability.
If a firm is earning zero economic profit, then its accounting profit will:
A. decrease in the long run. B. increase in the long run. C. be positive. D. be negative.
If the Fed buys $10 million dollars in government securities, and the required reserve ratio is 20 percent, the banking system is able to expand the money supply by:
A. $10 million. B. $50 million. C. $2 million. D. $40 million.
Suppose that in a month the price of a cup of coffee increases from $1 to $1.50. At the same time, the quantity of cups of coffee demanded decreases from 200 to 190. The price elasticity of demand for cups of coffee (calculated using the midpoint formula) is:
A. zero. B. inelastic. C. unit elastic. D. elastic.