1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
viva [34]
3 years ago
7

Suppose that the United States and China trade exclusively with each other. What will happen to the value of the U.S. dollar, ce

teris paribus, if the price level in China rises faster than the price level in the United States
Business
1 answer:
grin007 [14]3 years ago
6 0

Answer:

If the price level in China is rising faster than the price level in the US, this means that the Chinese inflation rate is higher.

two different things will happen here:

1) higher inflation means that Chinese products will be more expensive which will increase the demand for American products. An increase in the demand for American products will appreciate the US dollar, but...

2) Inflation all by itself generally would not alter the exchange rate, but high inflation generally leads to high interest rates. Central banks usually increase interest rates to decrease inflation.

Higher interest rates will usually increase the demand of a currency which result in an appreciation of the local currency against foreign currencies. In this case, the Chinese yuan should appreciate against the US dollar.

Generally the appreciation of a currency due to high interest rates will offset the depreciation due to a negative trade balance.

You might be interested in
Suppose the price of apples doubles to $3.00 between year 1 and year 2 but that nothing else in the economy changes Instructions
Bond [772]

Answer:

1. Suppose Quantity of Apple sold in year one & two =  100Kg.

Price in year 1 = $1.50 per kg

Price in year 2 = $3.00 per kg

Nominal GDP 1 = Price * Quantity = 1.50*100 = $150

Nominal GDP year 2 = 3*100 = $300

Change in Nominal GDP = $150

Percentage change in Nominal GDP = 100%

b. Real GDP of year 1 = Nominal GDP of year 1 = $150

Real GDP of year 2 = 1.50*100 = $150

Change in Real GDP = 0%

2. Quantity of Bread = 100 units price = $ 1 per unit, year 2 price = $ 2 per units

a. Nominal GDP year 1 = 1*100+1.5*100 = $250

Nominal GDP year 2 = 2*100+3*100 = $500

Percentage change in Nominal GDP = 500-250/500 * 100 = 100%

b. Real GDP year 1 = $250

Real GDP year 2 = 1*100 + 1.5*100 = $250

Percentage change in Real GDP = 0%

6 0
2 years ago
Austin sound sold inventory for $ 300,000, terms 2​/10, ​n/30. cost of goods sold was $152,000. how much sales revenue will aust
LenKa [72]

The correct answer is $300,000.

The company will report the actual amount of the sale - $300,000. The cost of goods sold is subtracted from the net sales on the income statement at the end of the fiscal period.

4 0
3 years ago
Give definitions of business enterprises​
Alinara [238K]

Answer:

efinition. Business enterprise means a firm, sole proprietorship, partnership, association, corporation, company, or other business entity of any kind including, but not limited to, a limited liability corporation, incorporated professional association, joint venture, estate, or trust.

Explanation:

8 0
3 years ago
Stock X has a standard deviation of 25 percent per year and stock Y has a standard deviation of 16 percent per year. The correla
Zanzabum

Answer:

The portfolio standard deviation is 14.82%

Explanation:

The portfolio standard deviation would be calculated by finding out the variance of the portfolio and taking the square root of it.

Variance of the portfolio = [(1 - .50)^{2} x 0.25^{2}] + [0.50^{2} x 0.16^{2}] + [2 x (1 - 0.50) x 0.50 x 0.25 x 0.16 x 0]

= [0.25 x 0.0625] + [0.25 x 0.0256] + [0]

= 0.015625 + 0.0064

VarPort = 0.022025

Std DevPort  = √0.022025

Std DevPort = 0.1482 = 14.82 percent

3 0
3 years ago
Read 2 more answers
Which information would most likely cause a company's stock price to go up?
Andrei [34K]

Answer:

A

Explanation:

consumers reduce spending because of a recession

8 0
3 years ago
Other questions:
  • Jill wants to save up for a down payment for her first home to be purchased 8 years from now. If she can earn 8% on her savings
    15·1 answer
  • Thoro Clean, a firm providing house-cleaning services, began business on April 1. The following accounts in its general ledger a
    10·1 answer
  • What is the order in which the three separate management decisions should be completed for HRM managers that design effective co
    12·1 answer
  • Sidewinder, Inc., has sales of $634,000, costs of $328,000, depreciation expense of $73,000, interest expense of $38,000, and a
    5·1 answer
  • A land development company is considering the purchase of earth-moving equipment. This equipment will have an estimated first co
    6·1 answer
  • When a customer is venting their anger, they will be easier to deal with if you _____.
    12·1 answer
  • This type of organization allows for many people to make decisions about the same service or need within the company.
    11·1 answer
  • The Nash Inc., a manufacturer of low-sugar, low-sodium, low-cholesterol TV dinners, would like to increase its market share in t
    5·1 answer
  • The reason that quantum effects are not observable in the everyday, macroscopic world, is because:_____.
    13·1 answer
  • question content areawhat is one of the potential disadvantages of not allocating support department costs to production departm
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!