Suppose That the Government of Syria Raises Its Budget Deficit

question 188

Multiple Choice

Suppose that the government of Syria raises its budget deficit.The real exchange rate of the Syrian pound would

• A)depreciate and Syrian net exports would rise.
• B)depreciate and Syrian net exports would fall.
• C)appreciate and Syrian net exports would rise.
• D)appreciate and Syrian net exports would fall.

---

Definitions:

Depreciation

Depreciation is the accounting process of allocating the cost of tangible assets over their useful lives, reflecting wear and tear or obsolescence.

Real GDP

The total value of all goods and services produced within a country in a year, adjusted for inflation, providing a more accurate reflection of an economy's size and growth rate.

General Price Level

An indicator of the average prices of goods and services across the economy at a specific point in time.

Inflation

An economic condition marked by a sustained increase in the general price level of goods and services in an economy over a period of time.