A Fall in Domestic Prices Relative to Foreign Prices,other Things

question 10

Multiple Choice

A fall in domestic prices relative to foreign prices,other things being equal,causes the net export (NX) function to shift ________ and ________.

• A)upward; become flatter
• B)upward; become steeper
• C)downward; become flatter
• D)downward; keep the same slope
• E)downward; become steeper

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Definitions:

Direct Materials

Raw materials that can be directly traced to the manufacturing of a product and are an essential component of the finished product.

Direct Labor

The cost of workers who are directly involved in producing goods or providing services.

Manufacturing Overhead

All indirect costs associated with manufacturing, excluding direct materials and direct labor.

Merchandising

The activities involved in promoting and selling products, often used in retail to refer to the purchase of goods for resale.