Assuming That the Exchange Rate Rises by 5 Percent,hence,the Dollar

question 28

Multiple Choice

Assuming that the exchange rate rises by 5 percent,hence,the dollar volume of exports rises by 5 percent,then foreign exchange earnings would

• A)remain constant.
• B)increase by 5 percent.
• C)actually decrease by 5 percent.
• D)increase by 10 percent.

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Definitions:

Demand

How much of a good or service that consumers can and want to buy, influenced by differing price levels.

Economic Profit

The difference between total revenues and total costs, including both explicit and implicit costs, representing the surplus generated from economic activities.

Technological Change

A change in the methods, equipment, and software used by a society, improving efficiency, productivity, and quality of life.

Marginal Cost

The additional cost incurred by producing one more unit of a good or service; essential for making efficient production and pricing decisions.