As the price level rises, the exchange rate
a. falls, so exports rise and imports fall.
b. falls, so exports fall and imports rise.
c. rises, so exports rise and imports fall.
d. rises, so exports fall and imports rise.
d
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Many economists believe that the collapse of world trade and the depression in the 1930s were linked by a decrease in real income caused by producing on the basis of comparative advantage
a. True b. False Indicate whether the statement is true or false
Suppose a permanent increase in demand for the Argentinean peso causes a chronic shortage of this currency in the foreign exchange market. The Argentinean government should then:
a. request other countries to revalue their currency. b. devalue the peso. c. allow the peso to appreciate. d. restricts exports. e. restrict imports.