If the Price of the Brazilian Real Is 60 Cents

question 102

Multiple Choice

If the price of the Brazilian real is 60 cents and a U.S. resident purchases a Brazilian-manufactured item for 60,000 real, there will be

• A) a quantity demanded of 60,000 real and a quantity supplied of $60,000.
• B) a quantity demanded of 60,000 real and a quantity supplied of $36,000.
• C) a quantity demanded of 60,000 real, but we cannot determine the effect in the market for dollars.
• D) a quantity supplied of 60,000 real and a quantity demanded of 60,000 yen.

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Definitions:

Firms' Costs

The expenses incurred by businesses in the production of goods or services, including labor, materials, and overhead costs.

Quantity Supplied

The extent of a good or service that merchants are willing and have the capacity to offer at a pre-determined price.

Supply Curve

A graphical representation showing the relationship between the price of a good or service and the quantity of that good or service suppliers are willing to offer for sale at various prices.

Price of Sugar

The cost at which sugar is sold or bought in the market.