« previous next »

Author Question: Which of the following would cause the current account to decrease? A) an increase in the nominal ... (Read 64 times)

K@

  • Hero Member
  • *****
  • Posts: 608
on: Jun 30, 2018
Which of the following would cause the current account to decrease?
 
  A) an increase in the nominal exchange rate, E
  B) an appreciation of the home currency
  C) an increase in disposable income
  D) an increase in foreign prices, P
  E) a decrease in domestic prices, P

Question 2

Write an essay on the gains from free international trade.
 
  What will be an ideal response?


Sassygurl126

  • Sr. Member
  • ****
  • Posts: 320
Reply #1 on: Jun 30, 2018
Answer to Question 1

C

Answer to Question 2

Static gains from trade-trade leads to a new set of relative prices which, in turn, imply new consumption levels and a redistribution of resources in favor of comparative advantage industries. The combination of effects leads, in a static environment, to an improved standard of living. Dynamic gains from trade-trade can lead to an outward expansion of a country's production possibility frontier.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

About 600,000 particles of skin are shed every hour by each human. If you live to age 70 years, you have shed 105 pounds of dead skin.

Did you know?

About 100 new prescription or over-the-counter drugs come into the U.S. market every year.

Did you know?

The term bacteria was devised in the 19th century by German biologist Ferdinand Cohn. He based it on the Greek word "bakterion" meaning a small rod or staff. Cohn is considered to be the father of modern bacteriology.

Did you know?

Every flu season is different, and even healthy people can get extremely sick from the flu, as well as spread it to others. The flu season can begin as early as October and last as late as May. Every person over six months of age should get an annual flu vaccine. The vaccine cannot cause you to get influenza, but in some seasons, may not be completely able to prevent you from acquiring influenza due to changes in causative viruses. The viruses in the flu shot are killed—there is no way they can give you the flu. Minor side effects include soreness, redness, or swelling where the shot was given. It is possible to develop a slight fever, and body aches, but these are simply signs that the body is responding to the vaccine and making itself ready to fight off the influenza virus should you come in contact with it.

Did you know?

In inpatient settings, adverse drug events account for an estimated one in three of all hospital adverse events. They affect approximately 2 million hospital stays every year, and prolong hospital stays by between one and five days.

Past and current ranges of the grizzly bear. Past and current ranges of the grizzly bear.
Heliospheric-current-sheet Heliospheric-current-sheet
Mean scores for Erikson’s stage V (Identity) for two cohorts. Scores for both cohorts increase ... Mean scores for Erikson’s stage V (Identity) for two cohorts. Scores for both cohorts increase ...
Co-current flow in a concentric tube heat exchanger Co-current flow in a concentric tube heat exchanger
Buildings account for 15% of greenhouse gas emissions Buildings account for 15% of greenhouse gas emissions
Increase in Surface Area by Mechanical Weathering Increase in Surface Area by Mechanical Weathering
Video: What is Cholesterols? Introduction to Lipoproteins

For a complete list of videos, visit our video library