What Is the Relationship Between the Relative Strength of the Dollar

question 67

Multiple Choice

What is the relationship between the relative strength of the dollar and imports and exports from the country?

• A) A stronger dollar means more imports and more exports.
• B) A stronger dollar means less imports and less exports.
• C) A stronger dollar means more imports and less exports.
• D) A stronger dollar means less imports and more exports.
• E) There is no direct relationship.

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Definitions:

Inelastic Demand

When the quantity demanded of a good or service changes very little with a change in price, showing low sensitivity.

Demand

The desire for a particular good or service backed by the ability and willingness to pay for it.

Industrially Advanced Economies

Countries that are highly developed with significant industrial growth, sophisticated technology, and strong infrastructure, typically experiencing high standards of living.

Highly Elastic

refers to the sensitivity of demand or supply to changes in price or other factors, where a small change can cause a significant change in the quantity demanded or supplied.