If the dollar appreciates while foreign income rises:
A. the U.S. AD curve would likely remain unchanged.
B. the U.S. AD curve would likely shift to the left.
C. what happens to the U.S. AD curve is unclear.
D. the U.S. AD curve would likely shift to the right.
Answer: C
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Refer to Table 16-4. Consider the hypothetical information in the table above for potential real GDP, real GDP, and the price level in 2016 and in 2017 if Congress and the president do not use fiscal policy
If Congress and the president use fiscal policy successfully to keep real GDP at its potential level in 2017, which of the following will be lower than if Congress and the president had taken no action? A) real GDP and potential GDP B) potential GDP and the inflation rate C) real GDP and the inflation rate D) real GDP and the unemployment rate
Even-handed enforcement of contracts fuels economic prosperity because it
What will be an ideal response?
A firm’s net investment will be negative if
a) the actual capital stock is less than the optimal capital stock b) the rate of return on capital exceeds the market interest rate c) the depreciation rate is less than the gross investment rate d) gross investment is zero e) its workforce is growing faster than its capital stock
For a monopolistically competitive market, the number of firms in the market implies that
A) each firm faces a perfectly elastic demand. B) all firms will make losses. C) each firm acts independently of other firms. D) firms will collude to set monopoly price and output.