The Effect of a Change in the Value of the Dollar

question 72

True/False

The effect of a change in the value of the dollar in the foreign exchange market due to a change in the price level helps explain the slope of aggregate demand, but does not shift it. The effects of a change in the value of the dollar in the foreign exchange market due to speculation is shown by shifting the aggregate demand curve.

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Definitions:

Confidence Interval

A range of values, derived from sample statistics, that is likely to contain the value of an unknown population parameter, with a certain degree of confidence.

Millilitres

A metric unit of volume equal to one thousandth of a liter, commonly used in liquid measurement.

Classification

The action or process of categorizing something according to shared qualities or characteristics.

Basis

In finance, the difference between the cash price and the futures price of an asset; in accounting, the initial value of an asset for tax purposes.