Asuka Notices That the Exams in Her Class Are Very

question 31

Multiple Choice

Asuka notices that the exams in her class are very easy and her scores are almost identical to Jimmy's. However, Jimmy does not study at all. Asuka therefore decides that it is not necessary to study very much at all for the next exam. According to equity theory, Asuka is

• A) Changing her inputs
• B) Changing her outcomes
• C) Changing her perception of her inputs
• D) Distorting her perceptions of Jimmy's inputs
• E) None of the above

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Definitions:

Nominal Exchange Rate

The speed at which one form of currency can be traded for another.

Currency

A system of money in general use in a particular country or economic context.

Real Exchange Rate

The value of a currency in terms of another currency, adjusted for differences in price levels between countries.

Net Capital Outflow

The difference between the purchase of foreign assets by domestic residents and the purchase of domestic assets by foreigners, which reflects the flow of capital out of a country.