This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: An increase in Mexican income decreases aggregate demand in the United States. Is the preceding ... (Read 122 times)

BrownTown3

  • Hero Member
  • *****
  • Posts: 564
on: Jun 29, 2018
An increase in Mexican income decreases aggregate demand in the United States. Is the preceding statement correct or incorrect? Briefly explain your answer.
 
  What will be an ideal response?

Question 2

Why can exchange rates be very volatile?
 
  What will be an ideal response?


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

fdliggud

  • Sr. Member
  • ****
  • Posts: 366
Reply #1 on: Jun 29, 2018
Answer to Question 1

The statement is incorrect. An increase in Mexican income means that Mexican citizens buy more goods and services exported from the United States. The increase in U.S. exports increases U.S. aggregate demand.

Answer to Question 2

Exchange rates can be volatile because in the foreign exchange market the factors that affect the supply also affect the demand and they reinforce each other. For instance, an increase in demand (which raises the exchange rate) often is accompanied by a decrease in the supply (which also raises the exchange rate). As a result, the exchange rate soars higher.


BrownTown3

  • Hero Member
  • *****
  • Posts: 564
Reply #2 on: Jun 29, 2018
Thank you


fdliggud

  • Sr. Member
  • ****
  • Posts: 366
Reply #3 on: Jun 29, 2018
No problemo


« previous next »
 

Did you know?

It is widely believed that giving a daily oral dose of aspirin to heart attack patients improves their chances of survival because the aspirin blocks the formation of new blood clots.

Did you know?

After 5 years of being diagnosed with rheumatoid arthritis, one every three patients will no longer be able to work.

Did you know?

In 2010, opiate painkllers, such as morphine, OxyContin®, and Vicodin®, were tied to almost 60% of drug overdose deaths.

Did you know?

The first oncogene was discovered in 1970 and was termed SRC (pronounced "SARK").

Did you know?

An identified risk factor for osteoporosis is the intake of excessive amounts of vitamin A. Dietary intake of approximately double the recommended daily amount of vitamin A, by women, has been shown to reduce bone mineral density and increase the chances for hip fractures compared with women who consumed the recommended daily amount (or less) of vitamin A.

Ethnic Variations in Prenatal Care within the United States Ethnic Variations in Prenatal Care within the United States
The United States, 1819 The United States, 1819
When using forearm pressure on the top of the shoulder, push with your back foot to increase your ... When using forearm pressure on the top of the shoulder, push with your back foot to increase your ...
Incidence of acute hepatitis B in the United States, 1980–2008. Incidence of acute hepatitis B in the United States, 1980–2008.
Effect of an Increase in R&D in the Follower Country on the Steady State Effect of an Increase in R&D in the Follower Country on the Steady State
Fraction of obese individuals by state in 1998 and 2008. In 1998, 42 states had obesity rates below Fraction of obese individuals by state in 1998 and 2008. In 1998, 42 states had obesity rates below
Video: Uterine (menstrual) cycle - phases

For a complete list of videos, visit our video library