Suppose Americans Buy Inputs from Foreigners

question 188

Multiple Choice

Suppose Americans buy inputs from foreigners.When the price of foreign inputs falls,the U.S.SRAS curve __________,which tends to __________the U.S.price level.

• A) shifts rightward; reduce
• B) shifts leftward; increase
• C) shifts leftward; reduce
• D) remains constant; increase

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Definitions:

Utilities Possibilities Frontier

A graphical representation showing the maximum amount of two or more goods or services that can be produced given a set of resources, highlighting the trade-offs and opportunity costs.

Equity

Fairness or justice in the way people are treated or how resources are distributed.

Efficiency

The optimal use of resources to achieve the desired outcome with minimal waste or expense, often associated with productivity and economic contexts.

Welfare Economics

The branch of economics that focuses on the optimal allocation of resources and goods and how the allocation affects social welfare.