Other Things the Same,the Real Exchange Rate Between U

question 45

Multiple Choice

Other things the same,the real exchange rate between U.S.and Belgian goods would be higher if

• A)​prices in the U.S.were higher,or the number of euro the dollar purchased were higher.
• B)​prices in the U.S.were higher,or the number of euro the dollar purchased were lower.
• C)​prices in the U.S.were lower,or the number of euro the dollar purchased were higher.
• D)​prices in the U.S.were lower,or the number of euro the dollar purchased were lower.

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Definitions:

Recession

A phase of brief economic downturn marked by a decrease in business and manufacturing activities, typically recognized when there's a drop in Gross Domestic Product (GDP) for two consecutive quarters.

Price Ceiling

A government-imposed limit on how high a price can be charged on a product, intended to protect consumers from high prices, but can lead to shortages.

Shortage/Surplus

A market condition where the quantity demanded exceeds the quantity supplied (shortage) or the quantity supplied exceeds the quantity demanded (surplus).

Price Ceiling

a legally imposed maximum price on goods or services, above which they may not be sold to prevent market prices from rising too high.