What Impact Does a Decrease in the Price Level in Canada

question 100

Multiple Choice

What impact does a decrease in the price level in Canada have on net exports and why?

• A)A decrease in the price level increases net exports because lower prices increase the value of the dollar.
• B)A decrease in the price level increases net exports by reducing the relative cost of Canadian goods.
• C)A decrease in the price level reduces net exports because lower prices raise the value of the dollar.
• D)A decrease in the price level reduces net exports because lower prices increase American spending on imports.
• E)A decrease in the price level reduces net exports because lower prices reduce the value of the Canadian dollar making exports more costly.

Explain the paradox of thrift and its economic implications.

Understand the process and requirements for passing fiscal policy measures.

Evaluate policies to address inflationary and deflationary gaps and their impact on full employment GDP.

Assess the impact of fiscal policy decisions on the national debt and budget deficits/surpluses.

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Definitions:

Talcott Parsons

An American sociologist known for his development of a general theory for the study of society called structural functionalism.

Wright Mills

Wright Mills was a sociologist known for his work on social structure, the power elite, and the sociological imagination's role in understanding personal experience within larger social patterns.

Conflict Theory

A social theory proposing that societal structures are defined by social conflicts due to inequalities in power, resources, and status.

Functionalist

A perspective in sociology that emphasizes the importance of social structures and their role in maintaining societal stability and functionality.