The Marshall-Lerner Condition Holds That a Country's Current Account Balance

question 96

Multiple Choice

The Marshall-Lerner condition holds that a country's current account balance will ________ in response to a real ________ in a nation's currency if the________.

• A) improve; depreciation; sum of the price elasticities of export and import demand exceeds 1
• B) worsen; depreciation; sum of the price elasticities of export and import demand exceeds 1
• C) improve; appreciation; sum of the price elasticities of export and import demand exceeds 1
• D) improve; appreciation; sum of the price elasticities of export and import demand exceeds 0
• E) worsen; depreciation; sum of the price elasticities of export and import demand exceeds 0

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Definitions:

NOIR

An acronym representing four levels of measurement in statistics: Nominal, Ordinal, Interval, and Ratio.

Nominal

A system of classification based on names rather than scales or rank ordering—for example, press, radio, and television.

Ratio

In measurement, refers to a scale that contains a “true” zero—for example, zero speed on a speedometer.

Semantic Differential-Format

A type of survey rating scale that measures people's reactions to concept words or phrases across a semantic space of polar adjectives.