An increase in the U.S. price level will:
A)decrease U.S.exports.
B)decrease U.S.imports.
C)increase RGDP demanded in the United States.
D)both (a) and (c)

Question

An increase in the U.S. price level will:
A)​decrease U.S.exports.
B)​decrease U.S.imports.
C)​increase RGDP demanded in the United States.
D)​both (a) and (c)

Quizplus · Accepted Answer

An increase in the U.S. price level makes U.S. goods more expensive to foreign buyers, thus decreasing U.S. exports. It does not directly increase real GDP demanded in the United States or decrease U.S. imports in the manner described.

An Increase in the U.S. Price Level Will