Assume the Marshall-Lerner Condition Holds

question 53

Multiple Choice

Assume the Marshall-Lerner condition holds.Which of the following will cause an increase in net exports?

• A)an increase in government spending
• B)an increase in investment
• C)a reduction in foreign output
• D)a reduction in the real exchange rate
• E) all of the above

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Definitions:

Common Stock

A type of equity security that represents ownership in a corporation, with shareholders entitled to vote on corporate matters and receive dividends.

Acquisition

The process by which a company purchases most or all of another company's shares in order to take control of it.

Fair Value

The financial gain from selling an asset or the financial outlay for relocating a liability in an orderly market activity on the designated measurement day.

Consolidated Revenues

Total revenues generated by a parent company and its subsidiaries, presented in a combined form on the financial statements.