Mauritius, an island off the coast of Africa, competes with other countries producing goods with low-skilled labor. In 2006, it was reported that its "...factories have been exposed to ... competition from China, India, and other Asian mass producers." As a result, "the main export industry has seen a 30% reduction in volume..." The decrease in exports will cause __________ and the price level will __________.
a) a downward shift in the AE curve; decrease as the AD curve shifts leftward in the short run
b) an upward shift in the AE curve; increase as the AD curve shifts rightward in the long run
c) a leftward shift in the AD curve; fall in the short run and rise in the long run
d) a leftward shift in the AD curve; rise in the long run as goods become more scarce.
c) a leftward shift in the AD curve; fall in the short run and rise in the long run
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The chair of the Board of Governors of the Fed must resign when a new president is elected
a. True b. False Indicate whether the statement is true or false