Suppose we witness a fall in the value of the dollar against other currencies, which makes U. S. final goods and services cheaper to foreigners even though the U. S. aggregate price level stays the same. As a result, foreigners demand more American aggregate output. Your initial belief is that this represents a movement down the aggregate demand curve because foreigners are demanding more in response to a lower price. Your research, however, insist that this represents a rightward shift of the aggregate demand curve. How can you explain this?
+3
Answers (1)
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Suppose we witness a fall in the value of the dollar against other currencies, which makes U. S. final goods and services cheaper to ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Home » Business » Suppose we witness a fall in the value of the dollar against other currencies, which makes U. S. final goods and services cheaper to foreigners even though the U. S. aggregate price level stays the same.