According to the J-Curve Concept,which of the Following Is False--That

question 52

Multiple Choice

According to the J-curve concept,which of the following is false--that the effects of a currency depreciation on the balance of payments are:

• A) Transmitted primarily via the income adjusted mechanism
• B) Likely to be adverse or negative in the short run
• C) In the long run positive,given favorable elasticity conditions
• D) Influenced by offsetting devaluations made by other countries

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Definitions:

Demand-Side Market Failures

Underallocations of resources that occur when private demand curves understate consumers’ full willingness to pay for a good or service.

Supply Curve

Represents the relationship between the price of a good or service and the quantity of that good or service that a supplier is willing and able to supply to the market.

Willingness To Pay

The maximum amount a consumer is prepared to spend to acquire a good or service, reflecting its perceived value.

Full Cost

The total expense associated with producing a product or providing a service, including both direct and indirect costs.