There's been a real depreciation of the dollar over the past month. In the long run, you would expect the quantity of
A. American imports to rise and the quantity of American exports to fall.
B. American imports to fall and the quantity of American exports to rise.
C. American imports to rise and the quantity of American exports to rise.
D. American imports to fall and the quantity of American exports to fall.
Answer: B
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If the quantity of money starts to grow more rapidly than real GDP and velocity does not change, the result is
A) slower growth in the price level. B) an increase in investment. C) more rapid growth in potential GDP. D) the inflation rate rises. E) an eventual slowing in the growth rate of the quantity of money.
As the federal funds rate rises, the banks' opportunity cost of holding excess reserves falls
a. True b. False Indicate whether the statement is true or false
A monopoly displays productive efficiency because it produces at the lowest possible average total cost
a. True b. False Indicate whether the statement is true or false
The price system allocates resources efficiently EXCEPT when
A) consumers decide they want more of a good. B) resources are utilized to produce the highest-valued goods and services. C) voluntary exchange exists. D) the production of a good affects parties other than its buyers and sellers.