A Fall in the Relative Prices of a Country's Exports

question 30

Multiple Choice

A fall in the relative prices of a country's exports tends to ________________ that country's net exports, and thereby, to ____ its real GDP.

• A)increase; raise
• B)decrease; raise
• C)decrease; decrease
• D)None of the above is correct.

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Definitions:

Actor/Observer Bias

The tendency to attribute one's own actions to external causes while attributing others' actions to their personality.

Self-Fulfilling Prophecy

A situation where an individual's expectations or the expectations of others lead to behaviors that cause those expectations to come true.

Ingroup/Outgroup Bias

The tendency to favor members of one's own group (the ingroup) over those in other groups (the outgroup), often leading to prejudice and discrimination.

Self-Fulfilling Prophecy

A belief or expectation that influences behavior in a way that causes the belief to become true.