What Impact Does an Increase in the Price Level in the United

question 123

Multiple Choice

What impact does an increase in the price level in the United States have on net exports and why?

• A)An increase in the price level decreases net exports because higher prices decrease the value of the dollar.
• B)An increase in the price level decreases net exports by increasing the relative cost of American goods.
• C)An increase in the price level increases net exports because higher prices lower the value of the dollar.
• D)An increase in the price level increases net exports because higher prices decrease American spending on imports.

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