When U.S.goods become more expensive relative to foreign goods,exports will ________ and imports will ________.
A) decrease; decrease
B) increase; increase
C) increase; decrease
D) decrease; increase
E) decrease; be unaffected

Question

Quizplus · Accepted Answer

When U.S. goods become more expensive relative to foreign goods, exports will decrease because foreign buyers will find U.S. goods too expensive compared to similar goods from other countries. At the same time, imports will increase because U.S. buyers will prefer cheaper foreign goods to domestically produced goods. Therefore, the correct answer is D: exports will decrease and imports will increase.

When USGoods Become More Expensive Relative to Foreign Goods,exports Will ________