What happens to the aggregate demand curve in the United States if the exchange rate increases so that U.S.-made products become more expensive?

In the income-expenditure model, inventories are:

A. constantly changing and provide insight into the future of the economy. B. a long-run event that aids forecasters in understanding where long-run real GDP is. C. fixed and therefore provide little insight into the direction of the economy. D. often positive, suggesting that additions to inventory stocks are a long-run goal.

Pizza at Home is a frozen pizza company that supplies several large grocery store chains. The managers of Pizza at Home are currently negotiating a four year contract with Saucy Pizza, a manufacturer of pizza sauce. Saucy Pizza will supply a specified quantity of canned tomato sauce to Pizza at Home over a four year period; however; Pizza at Home can ends its contract with Saucy Pizza at the end

of the first, second, or third years if Saucy Pizza does not supply quality tomato sauce. What can the manager of Pizza at Home do to avoid the end-game problem? A) Pay Saucy Pizza in full at the end of the third year. B) Offer a bonus to Saucy Pizza if they provide quality tomato sauce in all four years. C) Pay Saucy Pizza in equal installments at the end of each of the four years. D) Pay Saucy Pizza in full at the beginning of the first year.