Higher Real Interest Rates in the United States (Relative to Foreign

question 131

Multiple Choice

Higher real interest rates in the United States (relative to foreign real interest rates) will lead to a(n) _____________________ of the dollar,a ____________ shift of the U.S.AD curve and a _________________ shift of the U.S.SRAS curve.

• A)appreciation;rightward;leftward
• B)appreciation;leftward;rightward
• C)depreciation ;rightward;leftward
• D)depreciation;leftward;rightward
• E)appreciation;rightward;rightward

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Definitions:

Break-even Sales

The amount of revenue that a business must generate to cover its fixed and variable costs before starting to realize a profit.

Fixed Costs

Expenses that do not change with the level of goods or services produced by the business, such as rent, salaries, and insurance premiums.

Break-even Sales

The amount of revenue from sales that exactly covers fixed and variable costs, resulting in neither profit nor loss.

Fixed Costs

Expenses that do not change with the level of output or production, such as rent, salaries, and insurance premiums.