For a given nominal exchange rate and foreign price level, a decrease in the domestic price level ________ the real exchange rate.

A. decreases
B. may either increase or decrease
C. offsets any change in
D. increases

Answer: A

Economics

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Can changes in the growth rate of the velocity of money create a recession?

A. Yes, if the change is negative and large enough. B. No, because changes in the growth rate of velocity are temporary. C. No, because changes in the growth rate of velocity only affect inflation, not real growth. D. Yes, if the change is an unexpected increase in the growth rate of the velocity of money.

Economics

Ceteris paribus, in the short run following a decrease in the rate of growth in aggregate demand, we would expect to see an increase in the rate of unemployment and a decrease in the rate of inflation

Indicate whether the statement is true or false

Economics