Consumption

question 96

Multiple Choice

Consumption:

• A) is a major component of aggregate demand.
• B) is negatively related to the national price level.
• C) measures people's expenditures on real goods and services.
• D) All of these are true.

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Definitions:

Managed Floating Exchange Rate

An exchange rate that is allowed to change (float) as a result of changes in currency supply and demand but at times is altered (managed) by governments via their buying and selling of particular currencies.

Central Banks

Financial institutions responsible for the oversight of the monetary system for a nation or group of nations, controlling policies like interest rates and money supply.

Foreign Exchange

The exchange of one currency for another, or the conversion of one currency into another currency.

Trade Deficits

A situation in which a country's imports exceed its exports during a given time period.