In 2015, the Brazilian Currency, the Real, Depreciated Significanly

question 108

Multiple Choice

In 2015, the Brazilian currency, the real, depreciated significanly.The AS/AD model predicts that this would cause a trade:

• A)deficit for Brazil and shifted its AD curve left
• B)surplus for Brazil and shifted its AD curve left.
• C)deficit for Brazil and shifted its AD curve right.
• D)surplus for Brazil and shifted its AD curve right.

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Definitions:

Mutually Beneficial Trade

A trade agreement between parties that provides gains or advantages to all involved parties.

Tariff

a tax imposed on imported goods and services, intended to make foreign commodities less price-competitive than domestic goods.

Imports

Imports are goods and services bought by residents of a country from another country, which results in an outflow of currency to foreign markets.

Domestic Consumers

Individuals or entities within a country that purchase goods and services for personal use.