If the dollar price of foreign goods increases, we can expect that

Question

Quizplus · Accepted Answer

When the dollar price of foreign goods increases, it becomes more expensive for the United States to import those goods. This leads to a decrease in U.S. imports. On the other hand, foreign buyers will find U.S. goods relatively cheaper, leading to an increase in U.S. exports. Therefore, the best choice is B where U.S. imports will decrease and U.S. exports will increase.

If the Dollar Price of Foreign Goods Increases, We Can