A real depreciation will tend to cause A) a reduction in ...

[deesands]

A real depreciation will tend to cause
 
  A) a reduction in exports.
  B) an increase in imports.
  C) a reduction in net exports.
  D) an increase in demand for domestic goods.
  E) none of the above

Question 2

For this question, assume that there are decreasing returns to capital, decreasing returns to labor, and constant returns to scale. Now suppose that both capital and labor decrease by 5. Given this information, we know that output (Y) will
 
  A) not change.
  B) decrease by less than 5.
  C) decrease by 5.
  D) decrease by more than 5 but less than 10.
  E) none of the above

[iman]

Answer to Question 1

D

Answer to Question 2

C

[deesands]

TYSM

[atrochim]

Excellent