A Revaluation of a Currency,holding Everything Else Constant

question 359

Multiple Choice

A revaluation of a currency,holding everything else constant:

• A) makes foreign goods more attractive in the domestic economy.
• B) leads to an increase in aggregate demand and can therefore be expansionary.
• C) increases the balance of payments account towards a surplus.
• D) leads to a merchandise trade surplus.

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Definitions:

Unpleasant Situation

A scenario or condition that is not enjoyable or is likely to cause discomfort, distress, or dissatisfaction.

Escape

A behavioral response aimed at getting away from a threatening or uncomfortable situation or stimulus.

Escape Response

A behavioral reaction aimed at moving away from an unpleasant or harmful stimulus, often considered a basic survival instinct.

Vicarious Reinforcement

A form of learning that occurs by observing the rewards and punishments of another's behavior, leading to changes in the observer's own behavior.