A Sudden Decline in the International Value of the Dollar

question 35

Multiple Choice

A sudden decline in the international value of the dollar that dramatically increases the demand for American goods is an example of

• A) a price shock traceable to a shift in the IS curve.
• B) a price shock traceable to a shift in the LM curve.
• C) an aggregate demand shock traceable to a shift in the IS curve.
• D) an aggregate demand shock traceable to a shift in the LM curve.
• E) an exogenous shock that would have no effect on the domestic U.S. economy.

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Definitions:

Parasympathetic

The branch of the autonomic nervous system responsible for regulating the body's rest and digest functions, opposing the sympathetic system.

Sympathetic

Part of the autonomic nervous system responsible for the body's "fight or flight" response to stress.

Parasympathetic

Relating to the part of the autonomic nervous system that conserves energy by slowing down the heart rate and increasing intestinal and gland activity.

Somatic

Relating to the body, especially as distinct from the mind.