According to the Marshall-Lerner approach, a currency depreciation will best lead to an improvement on the home country's trade balance when the:
A: Home demand for imports is inelastic--foreign export demand is inelastic
B: Home demand for imports is inelastic--foreign export demand is elastic
C: Home demand for imports is elastic--foreign export demand is inelastic
D: Home demand for imports is elastic--foreign export demand is inelastic
A: Home demand for imports is inelastic--foreign export demand is inelastic
B: Home demand for imports is inelastic--foreign export demand is elastic
C: Home demand for imports is elastic--foreign export demand is inelastic
D: Home demand for imports is elastic--foreign export demand is inelastic
举一反三
- When demand is inelastic the price elasticity of demand is
- To maximize profit, the monopolist produces on the ________ portion of its demand where ________. A: elastic; P = MC B: elastic; MR = MC C: inelastic; P = MC D: inelastic; MR = MC
- The Marshall–Lerner condition indicates a stable foreign<br/>exchange market if the sum of the price elasticities of the demand<br/>for imports and the demand for exports0, in absolute terms, is less<br/>than 1. ()
- The Marshall-Lerner condition applies only if ηx+ηm > 1, in whichηx+ηm is ( ) A: supply price elasticity of domestic import and export commodities B: demand income elasticity of domestic imports and exports commodities C: expected Elasticity of demand for domestic imports and exports commodities D: demand price elasticity of domestic imports and exports commodities
- The Marshall-Lerner condition applies only if ηx+ηm > 1, in whichηx+ηm is ( ) A: supply price elasticity of domestic import and export commodities B: demand income elasticity of domestic imports and exports commodities C: expected Elasticity of demand for domestic imports and exports commodities D: demand price elasticity of domestic imports and exports commodities