If Inflation in the United States Is Higher Than Inflation

question 19

Multiple Choice

If inflation in the United States is higher than inflation in other countries,what will be the effect on net exports for the United States?

• A)Net exports will rise as U.S.exports increase.
• B)Net exports will rise as U.S.imports decrease.
• C)Net exports will decrease as U.S.exports decrease.
• D)Net exports will decrease as U.S.imports decrease.

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Definitions:

Transfer Price

The price at which goods or services are sold between departments within the same organization or between affiliated companies.

Division Producing

An organizational unit within a company that is responsible for creating a specific group of products or services.

Intermediate Product

Goods used as inputs in the production of final products, not sold directly to end consumers.

Transfer Price

The price at which goods or services are sold between divisions within the same company.