The J-Curve Summarizes the Phenomenon That Occurs When Import Spending

question 62

True/False

The J-curve summarizes the phenomenon that occurs when import spending initially falls after a depreciation of a country's currency and then import spending later rises.

---

Definitions:

Comparative Advantage

The competence of an individual, firm, or nation to forge a good or render a service with a lower forfeited opportunity compared to others in the market.

Productivity

A measure of the efficiency of production, usually defined as the ratio of outputs produced to inputs used.

Opportunity Costs

The cost of foregoing the next best alternative when making a decision or choosing one option over another.

Opportunity Cost

The financial consequence of rejecting the subsequent optimal choice when deciding.