Imagine That There Are Only Two Nations in the World

question 180

Multiple Choice

Imagine that there are only two nations in the world, the United States and Mexico.If Mexico experiences a drop in the price of foreign exchange, people in Mexico will

• A)have to buy more U.S.currency, because prices of imports from the United States will have increased
• B)end up buying less U.S.currency, because U.S.prices on goods will decrease to everyone
• C)be able to afford less U.S.currency, and imports from the United States will be more expensive
• D)be able to afford more U.S.currency, and imports from the United States will be cheaper
• E)be able to afford more U.S.currency, and imports from the United States will be more expensive

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Definitions:

Coercive Power

The ability to compel or force someone to do something through threats or force.

Legitimate Power

Power that is officially sanctioned by an organization or institution, and is accepted by members as rightly exercised.

Reward Power

The ability of a person to influence others' actions, behaviors, or attitudes by offering them something desirable.

Salary Raises

Incremental increases in wages given to employees, typically as a reward for performance, tenure, or to adjust for market conditions.