Choose the Letter of the Diagram in Figure 36

question 79

Multiple Choice

Choose the letter of the diagram in Figure 36.2 that represents the shift in the foreign exchange market for dollars given the following situation,ceteris paribus: The U.S.economy suddenly experiences a recession.

• A)a.
• B)b.
• C)c.
• D)D.A recession will cause a leftward shift in the supply of dollars since U.S.consumers,feeling the pinch of the recession,will cut back on purchases of imports,reducing the supply of dollars on the foreign exchange market.

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Definitions:

Full Employment

A situation in an economy where all available labor resources are being used in the most efficient way possible, typically characterized by the absence of involuntary unemployment.

Full Production

A state of economic production in which all available resources (labor, capital, etc.) are being used efficiently, leading to the maximum possible output.

Capacity Utilization

The percentage of a country's production capacity that is actually being used over a certain period of time, indicating the overall economic activity and efficiency.

Labor Unemployment

A situation where individuals who are willing and able to work are unable to find employment, often measured by the unemployment rate.