What Happens in the Domestic Economy When There Is a Decrease

question 62

Multiple Choice

What happens in the domestic economy when there is a decrease in foreign prices, all other things unchanged?

• A) Net exports and aggregate demand fall.
• B) Net exports fall and aggregate demand increases.
• C) Net exports and aggregate demand increase.
• D) Net exports rise and aggregate demand falls.

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Definitions:

Dynamics

The forces or properties that stimulate growth, development, or change within a system or process.

Specific Theory

A detailed and precise theory that explains a particular phenomenon or aspect of a larger phenomenon.

Embedded Case Study

A method of research where the case study contains multiple units of analysis within a single case, allowing for detailed and complex analysis.