Within the United States, a(n)
A) decrease in the price level will make U.S. exports more expensive to foreign consumers.
B) increase in the price level will make U.S. exports more expensive to foreign consumers.
C) increase in the price level will make U.S. exports less expensive to foreign consumers.
D) decrease in the price level will make U.S. exports neither more nor less expensive to foreign consumers.

Question

Quizplus · Accepted Answer

An increase in the price level will lead to a decrease in the purchasing power of the currency, which will make U.S. exports more expensive to foreign consumers. This is because they will need to spend more of their own currency to purchase the same amount of U.S. goods, resulting in a higher price for those goods.

Within the United States, A(n)