Which of the Following Statements Best Describes the Relationship Between

question 55

Multiple Choice

Which of the following statements best describes the relationship between exchange rates and aggregate demand for U.S. output?

• A)The exchange rate has no effect on aggregate demand.
• B)A high exchange rate for the dollar tends to reduce aggregate demand, and a low rate tends to increase it.
• C)A high exchange rate for the dollar tends to increase aggregate demand, and a low rate tends to reduce it.
• D)Aggregate demand for U.S. output increases as the exchange rate increases.

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Definitions:

Discontinuous Change

An aspect of development that is characterized by abrupt or stage-like change.

Sudden Surge

An abrupt and substantial increase or intensification of something, such as energy, activity, or emotion, occurring in a short period of time.

Proficient

Having a high degree of skill or expertise in a particular field or activity.

Mastering

The process of acquiring complete skill or knowledge in a subject or activity.