Imports Have the Potential to Lower a Country's Inflation Rate

question 65

Multiple Choice

Imports have the potential to lower a country's inflation rate because of each of the following EXCEPT:

• A) the import of lower priced goods limits what domestic competitors can charge for goods.
• B) the import of lower priced services limits what domestic competitors can charge for services.
• C) the higher prices of foreign goods spurs domestic competitors to cut prices.
• D) all of the above

---

Definitions:

Present Value

The current worth of a future sum of money or stream of cash flows given a specified rate of return, considering the time value of money.

Speculative Bubbles

A situation in which prices for securities, especially stocks, rise far above their actual value based on expectations of further rises, typically followed by a sharp decline in prices.

Final Sale Price

The total cost at which a product or service is sold to the consumer, including the base price plus any additional charges or fees.

Future Value

The value of an investment or a sum of money at a specified future date, accounting for specified interest rates or earnings over time.