![The Two Effects of a Stronger Dollar. 2nd Effect. [Choose] The direction of change to the AD curve when the value of the doll](http://img.homeworklib.com/questions/4f0f08a0-e797-11ea-ad7d-03a597a7684a.png?x-oss-process=image/resize,w_560)
Homework Answers
Ist Effect
The direction of change to the SRAS curve when the value of dollar increases relative to foreign currencies – Right.
The cause of change to SRAS when the value of dollar increases relative to foreign currencies– lower for input prices. (because foreign goods now have become cheaper).
Does the price level increase or decrease?– Decrease.
Does does Real GDP increase or decrease?– Increase (because SRAS Curve has shifted to the right).
IInd Effect.
the direction of change to the AD curve when the value of dollar increases relative to foreign currencies– Left
The the cause of of change to AD when the value of dollar increases relative to foreign currencies– decrease exports, increased imports.
Does does the price level increase or decrease?– Decrease.
Does Real GDP increase or decrease?– Decrease (because AD Curve has shifted to left)
what is the net effect of the 1st effect and 2nd effect of a stronger dollar on the domestic price level? – Decrease
What is the net effect of 1st effect and 2nd effect of a stronger dollar on the domestic real GDP?– unknown with information provided (because 1st and 2nd effect have opposing effect on domestic Real GDP).
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The Two Effects of a Stronger Dollar. 1st Effect. [Choose The direction of change to the...
Suppose the value of the U.S. dollar increases relative to foreign currencies. What would be the...
Suppose the value of the U.S. dollar increases relative to foreign currencies. What would be the short-run effect? Group of answer choices A. An increase in Real GDP, an increase in the GDP Deflator B. An increase in Real GDP, a decrease in the GDP Deflator C. A decrease in Real GDP, an increase in the GDP Deflator D. A decrease in Real GDP, a decrease in the GDP Deflator What is the long-run effect of a negative supply shock?...
18. If the federal government increases the dollar amount of Social Security benefit checks for the...
18. If the federal government increases the dollar amount of Social Security benefit checks for the elderly, then a. the consumption schedule will shift upward in the 45-degree line diagram. b. the aggregate demand curve will shift to the right in the aggregate demand aggregate supply curves diagram. c. the effect on the equilibrium real GDP will be the same as a cut in taxes. d. All of the above are correct. 19. The paradox of thrift is the notion...
EXERCISE 1:TRUE OR FALSE 1. If the dollar appreciates relative to foreign currencies, we would expect...
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The trade feedback effect shows that O A 50 million dollar increase in U.S. exports results...
The trade feedback effect shows that O A 50 million dollar increase in U.S. exports results in a 30 million dollar decrease in German imports. 0 A 100 million dollar increase in U.S. imports results in a 50 million dollar decrease in French imports. O A 100 million dollar increase in U.S. imports results in a 70 million dollar increase in U.S. exports. O A 1 billion dollar increase in U.S. GDP increases U.S. net exports by 100 million dollars.
Question 19 1 pts Let's say that the following two changes take place in the United...
Question 19 1 pts Let's say that the following two changes take place in the United States: 1. Corporate tax rates increase, making it less attractive for domestic and foreign corporations to invest in the U.S. 2. The quality of U.S.goods deteriorates, thus decreasing the demand for U.S.goods. Which of the following will happen as a result of these two changes? The U.S. dollar will increase in value and the price of our exports will decrease. The U.S. dollar will...
Which would most likely shift the aggregate supply curve? A change in the prices of _____....
Which would most likely shift the aggregate supply curve? A change in the prices of _____. domestic products foreign products financial assets resources A decrease in aggregate demand in the short run will reduce _____. both real output and the price level the price level and increase the real domestic output the real domestic output and have no effect on the price level the price level and have no effect on real domestic output The economy's long-run AS curve assumes...
U PLS (SLO/EO: 11a) If the U.S. dollar depreciates relative to currencies in other countries, then...
U PLS (SLO/EO: 11a) If the U.S. dollar depreciates relative to currencies in other countries, then U.S. imports will and exports will increase; increase decrease, decrease decrease; increase increase; decrease Question 30 3 pts (SLO/EO: 6,12) Long recessions often follow banking crises because: banking crises may cause a surplus of credit, so that interest rates fall to levels so low that investors earn very little in interest income. the vicious cycle of deleveraging that follows leads to overpriced assets. consumer...
22. Why is the multiplier for a change in taxes smaller than for a change in spendi...
22. Why is the multiplier for a change in taxes smaller than for a change in spending? a. A change in taxes has no effect on aggregate demand, only on aggregate supply. b. A change in taxes directly affects government spending as well, lowering the multiplier. c. A change in taxes affects spending directly, but at a slower rate than spending does. d. A change in taxes affects disposable income and then consumption rather than spending directly....
1. Explain what will happen to the price level real GDP and the unemployment rate in...
1. Explain what will happen to the price level real GDP and the unemployment rate in the following cases: a. AD falls by the same amount that SRAS rises b. AD falls by less than SRAS rises c. AD falls by more than SRAS falls d. AD falls by the same amount that SRAS falls e. AD falls by less than SRAS falls 2. Explain how expectations about future sales will affect investment. 3. How will a change in the...
18. If the federal government increases the dollar amount of Social Security benefit checks for the elderly, then a. the consumption schedule will shift upward in the 45-degree line diagram. b. the aggregate demand curve will shift to the right in the aggregate demand aggregate supply curves diagram. c. the effect on the equilibrium real GDP will be the same as a cut in taxes. d. All of the above are correct. 19. The paradox of thrift is the notion...
EXERCISE 1:TRUE OR FALSE 1. If the dollar appreciates relative to foreign currencies, we would expect a country's net exports to fall. If government decreases its purchases by $20 billion and the MPC is 0.8, equilibrium GDP will decrease by $100 billion. When a private closed economy is at equilibrium, then (GDP-C) is equal to planned investment. If planned investment is larger than saving, then real GDP will increase as the economy adjusts toward equilibrium. 5. Positive net exports increase...
The trade feedback effect shows that O A 50 million dollar increase in U.S. exports results in a 30 million dollar decrease in German imports. 0 A 100 million dollar increase in U.S. imports results in a 50 million dollar decrease in French imports. O A 100 million dollar increase in U.S. imports results in a 70 million dollar increase in U.S. exports. O A 1 billion dollar increase in U.S. GDP increases U.S. net exports by 100 million dollars.
Question 19 1 pts Let's say that the following two changes take place in the United States: 1. Corporate tax rates increase, making it less attractive for domestic and foreign corporations to invest in the U.S. 2. The quality of U.S.goods deteriorates, thus decreasing the demand for U.S.goods. Which of the following will happen as a result of these two changes? The U.S. dollar will increase in value and the price of our exports will decrease. The U.S. dollar will...
U PLS (SLO/EO: 11a) If the U.S. dollar depreciates relative to currencies in other countries, then U.S. imports will and exports will increase; increase decrease, decrease decrease; increase increase; decrease Question 30 3 pts (SLO/EO: 6,12) Long recessions often follow banking crises because: banking crises may cause a surplus of credit, so that interest rates fall to levels so low that investors earn very little in interest income. the vicious cycle of deleveraging that follows leads to overpriced assets. consumer...
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