According to the Marshall-Lerner condition, when a country's currency depreciates in real terms its trade balance will improve if Your answer: O elasticity of demand for exports = 0.9; elasticity of demand for imports = -0.4 elasticity of demand for exports = -0.8; elasticity of demand for imports = -0.3 Oelasticity of demand for exports = 0.5; elasticity of demand for imports =- 0.2 Oelasticity of demand for exports = 0.3; elasticity of demand for imports = -0.5

According to the Marshall-Lerner condition, when a country's currency depreciates in real terms its trade balance will improve if Your answer: O elasticity of demand for exports = 0.9; elasticity of demand for imports = -0.4 elasticity of demand for exports = -0.8; elasticity of demand for imports = -0.3 Oelasticity of demand for exports = 0.5; elasticity of demand for imports =- 0.2 Oelasticity of demand for exports = 0.3; elasticity of demand for imports = -0.5

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Purchasing power parity theory would suggest that if the Canadian price of a basket of goods is C$1,800, but the same basket in the United States is U.S.$1,300, and the actual exchange rate is C$1.30 = U.S.S1.00, then the value of the Canadian dollar should O A. depreciate by approximately 8.9 percent. O B. depreciate by approximately 6.2 percent. OC. appreciate by approximately 8.9 percent. O D. appreciate by approximately 6.2 percent. O E. remain unchanged.
When there is a surplus of dollars in the foreign exchange market, O A. the demand for Canadian dollars will increase so the foreign exchange market can move into equilibrium B. prices in Canada will fall relative to prices in the United States O C. the supply of Canadian dollars will increase so the foreign exchange market can move into equilibrium O D. the forces of supply and demand pull the foreign exchange market into equilibrium Click to select vour answer and then clic Chock Ancuor
If poor households spend relatively more on tradeable product categories, what happens after a large devaluation of domestic currency (assume a small open economy): O Relative price of tradeables goes down O Low-income households face relatively lower inflation than high- income households Cost of living of low-income relative to high-income households goes up after a large devaluation O There is little evidence of large distributional consequences from large devaluation
45
Determine which account of the Balance-of-Payments is affected the following transaction: A local parent sends 500 Euros to his/her son who is studying engineering at a German university. Select one: O a. Capital Account Foreign Direct Investment O b. Current Account Transfers O c. Capital Account Portfolio Investment O d. Current Account Imports O e. Current Account - Exports re to search
How will an increase in remittance flows to your country during the Christmas Season affect the market for foreign exchange? Select one: O a. Inward shift of the demand curve, real exchange rate falls and the balance of trade falls Ob. Outward shift of the demand curve, real exchange rate rises and the balance of trade rises Inward shift of the demand curve, real exchange rate rises and the balance of trade falls Inward shift of the supply curve, real exchange rate rises and the balance of trade rises Outward shift of the supply curve, real exchange rate falls and the balance of trade falls pe here to search. la
7 Please answer all??
Answer it correctly please. I ll rate accordingly with multiple votes. Do it correct and fast. Explain well.
Consider a country with a flexible exchange rate, and which initially has a current account surplus of zero. Then, suppose there IS an anticipated InCrease in tuture total tactor productivity. a) Determine the eauilibrium etects on the domestic economv in the case where there are no capita. controls. In particular, show that there will be a current account dehicit when arms and consumers anticipate the increase in future total factor productivity. b) Now, suppose that the government dislikes current account deficits, and that It imposes capital controls in an attempt to reduce the current account deficit. With the anticipated increase in future total factor productivity, what will be the equilibrium efects on the economy? Do the capital controls have the desired efect on the current account deficit? Do capital controls dampen the effects of the shock to the economy on output and the exchange rate? Are capital controls sound macroeconomic policy in this context? Why or why not?
Please no written by hand solution
True or False: If the dollar depreciates relative to the Japanese yen, the dollar price of a Japanese camera produced by Nikon becomes less expensive for Americans. O True False
2. Assume two countries, Thailand (T) and Japan (J), have one good: cameras. The demand (d) and supply (s) for cameras in Thailand and Japan is described by the following functions: Qd" = 60 – P; Qs™ =-5 + 1/4 P; =-10+ 1/2 P. Qd'= 80 – P; Qs' P is the price measured in a common currency used in both a. Compute the equilibrium price (P) and b. Now assume that free trade countries, such as the Thai Baht. quantities (Q) in each country without trade. occurs. The free trade price goes to 56.36 Baht. Who exports and imports cameras and in what quantities?