A Decrease in the Real Interest Rate in the U

question 1

Multiple Choice

A decrease in the real interest rate in the U.S. will cause net exports to:

• A) increase because exports will remain constant but imports will decrease.
• B) decrease because exports will decrease and imports will increase.
• C) decrease because exports will increase but imports will increase.
• D) increase because exports will increase and imports will decrease.

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Definitions:

Markup Pricing

A pricing strategy where a fixed percentage is added to the cost of a product to determine its selling price.

Target-Return Pricing

Involves setting the price of a product based on the expected return on investment (ROI), aiming to meet a predefined profit goal.

Markup

Markup refers to the difference between the cost of a good or service and its selling price, expressed as a percentage of the cost.

Selling Price

The amount of money for which a product or service is sold to customers.