When the Dollar Rises Relative to Other Currencies

question 56

Multiple Choice

When the dollar rises relative to other currencies,

• A)foreign goods are more expensive in terms of dollars.
• B)foreign currency is more expensive in terms of dollars.
• C)U)S. goods become more expensive to foreigners.
• D)foreign currency is more expensive in the United States, but foreign goods are cheaper.

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Definitions:

Quantity of Labor

The total number of labor hours employed or the total number of workers employed in the production of goods and services.

Excise Tax

A tax levied on specific goods, services, or transactions, often imposed on alcohol, tobacco, and gasoline.

Supply Curve

A graphical representation showing the relationship between the price of a good and the amount of it that suppliers are willing to produce and sell.

Perfectly Inelastic

A scenario where the demand for a good does not change in response to changes in price, represented by a vertical demand curve.