Explain the direct increases in the US price relative to foreign goods.

Question

Will a direct increase in the price of U.S. goods relative to foreign goods lead to a change in the quantity demanded of Real GDP or to a change in Aggregate Demand? Will a change in the exchange rate that subsequently increases the price of U.S. goods relative to foreign goods lead to a change in the quantity demanded of Real GDP or to a change in Aggregate Demand?

Answer 1

Question

Chapter 8, Problem 13QP

To determine

Explain the direct increases in the US price relative to foreign goods.

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