Exchange-Rate Adjustments And The Balance of

A. depreciation generally improves the trade balance
B. depreciation generally hurts the trade balance
C. no strong generalization is possible
D. depreciation has no effect on the trade balance

A. pass through
B. absorption
C. adjustment mechanism
D. currency contract period

A. sooner
B. longer
C. bigger
D. smaller

A. improves
B. worsens
C. is unaffected
D. falls for a while before increasing

A. should increase the dollar value of exports
B. should not have any effect on the dollar value of U.S imports
C. must increase the balance of trade
D. All of the above

A. import prices to fall by 10 percent
B. import prices to rise by 10 percent
C. export prices to rise by 10 percent
D. export prices to fall by 10 percent

A. appreciation in the value of both currencies
B. depreciation in the value of both currencies
C. appreciation in the value of the yen against the mark
D. depreciation in the value of the yen against the mark

A. shorten the amount of time in which the depreciation leads to smaller trade deficit
B. shorten the amount of time in which the depreciation leads to smaller trade surplus
C. lengthen the amount of time in which the depreciation leads to smaller trade deficit
D. lengthen the amount of time in which the depreciation leads to smaller trade surplus

A. trade surplus in the short run
B. trade surplus in the long run
C. trade deficit in the short run
D. trade deficit in the long run

A. elasticity of demand for exports = 0.9; elasticity of demand for imports = 0.4
B. elasticity of demand for exports = 0.7; elasticity of demand for imports = 0.3
C. elasticity of demand for exports = 0.5; elasticity of demand for imports = 0.7
D. elasticity of demand for exports = 0.3; elasticity of demand for imports = 0.6