Assume That the U

question 73

Multiple Choice

Assume that the U.S.dollar depreciates against the Japanese yen.What is the impact on aggregate expenditures and income?

• A)Both increase.
• B)Both decrease.
• C)Aggregate expenditure increases and income decreases.
• D)Aggregate expenditure decreases and income increases.

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Definitions:

Market Price

The ongoing price level for buying or selling an asset or service in the open market.

Market Output

The total quantity of goods and services produced and offered for sale in a market.

External Benefits

Positive effects experienced by third parties as a result of an economic transaction not directly involved.

Efficient Outcome

A situation in which no individual can be made better off without making someone else worse off, typically referring to an optimal allocation of resources.