-Refer to Figures A, B, C, and D. Which of the figures best illustrates a situation where foreign income rises ceteris paribus?
A)Figure A
B)Figure B
C)Figure C
D)Figure D

Question

-Refer to Figures A, B, C, and D. Which of the figures best illustrates a situation where foreign income rises ceteris paribus?
A)Figure A 
B)Figure B 
C)Figure C 
D)Figure D

Quizplus · Accepted Answer

Figure A likely shows an increase in demand for domestic exports as a result of rising foreign income, ceteris paribus. When foreign income rises, foreigners have more money to spend, and they may spend some of this increased income on goods and services from abroad, leading to an increase in exports from the domestic country.