ECON 131 Quiz 7

______________ equalizes the prices of internationally traded goods across countries.

Purchasing power parity

A _______________ monetary policy can be used to decrease aggregate demand because it _____________ exports and _________________ imports.

contractionary; reduces; stimulates

From a macroeconomic point of view, increases in _______ are an addition to aggregate demand, while increases in _________ are a subtraction from aggregate demand.

exports; imports

Foreign direct investment is the term used to describe purchases of firms in another country that involve ______________________.

taking a management responsibility

If a nation merges its currency with another nation to create a single currency, what must it give up?

the ability to determine its own nationally-oriented monetary policy

If 112 Japanese yen purchased $1.00 U.S. in 2008 and 83 Japanese yen purchased $1.00 U.S. in 2009, then:

the dollar depreciated against the yen.