The Marshall-Lerner Condition Holds That a Country's Current Account Balance

question 20

Multiple Choice

The Marshall-Lerner condition holds that a country's current account balance will ________ in response to a real ________ in a nation's currency if ________.

• A)improve;depreciation;sum of the price elasticities of export and import demand exceeds 1
• B)worsen;depreciation;sum of the price elasticities of export and import demand exceeds 1
• C)improve;appreciation;sum of the price elasticities of export and import demand exceeds 1
• D)improve;appreciation;sum of the price elasticities of export and import demand exceeds 0
• E)worsen;depreciation;sum of the price elasticities of export and import demand exceeds 0

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Definitions:

Repetitive Behaviors

Actions performed over and over again, which can be a characteristic of certain psychological conditions, such as OCD.

Obsessive Thoughts

Intrusive, unwanted thoughts that often cause distress or anxiety and may lead to compulsive behaviors in an attempt to alleviate the distress.

Obsessive-Compulsive Disorder (OCD)

A mental disorder where individuals experience repetitive, unwanted thoughts (obsessions) and behaviors (compulsions) they feel compelled to perform.

DSM-5

The Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition, a classification and diagnostic tool for mental disorders used by mental health professionals.