Figure 13-1
-Refer to Figure 13-1.Ceteris paribus,a decrease in the value of the domestic currency relative to foreign currencies would be represented by a movement from
A)AD1 to AD2.
B)AD2 to AD1.
C)point A to point B.
D)point B to point A.

Question

Figure 13-1 
-Refer to Figure 13-1.Ceteris paribus,a decrease in the value of the domestic currency relative to foreign currencies would be represented by a movement from
A)AD1 to AD2. 
B)AD2 to AD1. 
C)point A to point B. 
D)point B to point A.

Quizplus · Accepted Answer

A decrease in the value of the domestic currency makes domestic goods cheaper for foreign buyers, increasing exports and aggregate demand, thus shifting the AD curve from AD1 to AD2.

Figure 13-1 -Refer to Figure 13-1.Ceteris Paribus,a Decrease in the Value of the Value