In Equilibrium Which of the Following Happens If the U

question 106

Multiple Choice

In equilibrium which of the following happens if the U.S. imposes tariffs on leather boots?

• A)U.S. production of leather boots rise
• B)U.S. net exports rise
• C)the exchange rate falls
• D)All of the above are correct.

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Definitions:

Long-term Capital Inflows

The movement of capital into a country over an extended period, often used for investment in major projects or to boost foreign reserves.

Foreign Travel

The act of traveling outside of one's home country for leisure, business, or other purposes.

U.S. Dollars

The official currency of the United States, also widely used as a global reserve currency.

Flexible Exchange Rates

A financial system where a currency's value is subject to change following the movements in the foreign exchange market.