If the Demand for U

question 117

Multiple Choice

If the demand for U.S. dollars goes up, the exchange rate will.

• A) increase and, as a result, net exports in the United States will decrease.
• B) decrease and, as a result, net exports in the United States will increase.
• C) increase and, as a result, net exports in the United States will increase.
• D) decrease and, as a result, net exports in the United States will decrease.

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Definitions:

Wage Rate

The amount of money paid to an employee per unit of time, often per hour or year.

Labor Supply

The total number of hours that workers are willing and able to work at a given wage rate.

Utility Maximizing

The economic principle that consumers will choose a combination of goods and services that maximize their overall satisfaction.

Indifference Curves

graphical representations in microeconomics illustrating combinations of goods that provide an individual with the same level of satisfaction.