g Other things the same, an increase in the price level causes the interest rate to a. increase, the dollar to depreciate, and net exports to increase. b. increase, the dollar to appreciate, and net exports to decrease. c. decrease, the dollar to depreciate, and net exports to increase. d. decrease, the dollar to appreciate, and net exports to decrease.

Question

Cecelia Gates

Business

5 September, 18:16

g Other things the same, an increase in the price level causes the interest rate to a. increase, the dollar to depreciate, and net exports to increase. b. increase, the dollar to appreciate, and net exports to decrease. c. decrease, the dollar to depreciate, and net exports to increase. d. decrease, the dollar to appreciate, and net exports to decrease.

+5

Answers (1)

Know the Answer?

Bria Sweeney · Answer 1

B. Increase, the dollar to appreciate, and net exports to decrease.

Explanation:

When their is increase in price level, their is increase, the dollar to appreciate, and net exports to decrease.

In a case of such, when increase in price level happens it causes foreign bond purchase decrease also.

A case that can explain this better is this pandemic period that has befallen the world and its economy; it is seen that in a country like Nigeria, the high price of dollar makes purchasing and import a herculean tax and also cause decrease in export to boost the said economy causing a shaky economic depreciation which affect peoples lives negatively.