Maka's Bouncing Ball Company Is Deciding Whether to Manufacture Balls

question 28

Multiple Choice

Maka's Bouncing Ball Company is deciding whether to manufacture balls in its home country of Econia or in the neighboring country of Macroland. Maka expects the central bank of Econia to adopt a tight money policy over the next few years. Because of this expectation, Maka's would be more likely to produce in ______ because:

• A) Macroland; Econia's currency is likely to appreciate.
• B) Macroland; Econia's currency is likely to depreciate.
• C) Econia; Econia is more likely to experience rising prices.
• D) Econia; Econia is more likely to experience strong growth.

---

Definitions:

Decompression Melting

Melting of a rock or other material due to a decrease in pressure.

Decompression Melting

The process where rock melts due to a decrease in pressure, often occurring in the mantle.

Convection Cell

The movement of material in an elliptical to roughly circular loop by the process of convection; movement is driven by differences in density, especially those caused by temperature variations.

Ethanol

A volatile, flammable, colorless liquid alcohol, used as a biofuel and in the manufacture of various chemicals and pharmaceuticals.