If the United States Imports More Than It Exports, Then

question 19

Multiple Choice

If the United States imports more than it exports, then this means that

• A)the supply of dollars is likely to exceed the demand in the foreign exchange market, ceteris paribus.
• B)the demand for dollars is likely to exceed the supply in the foreign exchange market, ceteris paribus.
• C)the U.S. dollar would be under pressure to appreciate against other currencies.
• D)both b and c are correct

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Definitions:

Cash Inflows

Money or funds entering a business or project from various sources such as sales, investment, or loans.

Minimax Regret Strategy

A decision-making strategy aimed at minimizing the maximum potential regret for the worst-case scenario outcome.

Opportunity Loss

The loss of potential gain from other alternatives when one alternative is chosen.

Average Payoff

The mean or expected outcome that results from all possible outcomes of a certain situation or game, weighted by their probabilities.