- Quantity Of Wimps D Price Of Dollars Per Wimp W Fixed S The Currency Of Atlantis Is The Wimp In 2015 Atlantis Develop 1 (77.97 KiB) Viewed 12 times
- Quantity Of Wimps D Price Of Dollars Per Wimp W Fixed S The Currency Of Atlantis Is The Wimp In 2015 Atlantis Develop 2 (79.37 KiB) Viewed 12 times
- Quantity Of Wimps D Price Of Dollars Per Wimp W Fixed S The Currency Of Atlantis Is The Wimp In 2015 Atlantis Develop 3 (72.13 KiB) Viewed 12 times
- Quantity Of Wimps D Price Of Dollars Per Wimp W Fixed S The Currency Of Atlantis Is The Wimp In 2015 Atlantis Develop 4 (32.16 KiB) Viewed 12 times
The currency of Atlantis is the wimp. In 2015, Atlantis developed a balance-of-payments deficit with the United States as a result of an unanticipated decrease in exports, U.S. citizens cut back on the purchase of Atlantean goods. Assume Atlantis is operating under a system of fixed exchange rates. How does the drop in exports affect the market for wimps? 1.) Using the line drawing tool, draw a new demand line showing how the unanticipated decrease in exports influences the market for wimps Properly label your line. Note Carefully follow the instructions above and only draw the required object The balance-of-payments deficit is the difference between the OA. new quantity supplied and initial quantity supplied. OB. new quantity supplied and new quantity demanded. OC. new quantity demanded and initial quantity demanded. OD. new quantity supplied and initial quantity demanded To maintain the value of the wimp (in the long run), the government of Atlantis must OA. buy dollars at the old exchange rate OB. change the exchange rate. OC. use contractionary monetary policy OD. sell wimps.
If Atlantis had originally been operating at full employment (potential GDP), an unanticipated decrease in exports would have caused O A. an increase in employment OB. a fall in inventories. OC. an increase in unemployment. OD. a decrease in unemployment The chief economist of Atlantis suggests an expansionary monetary policy to restore full employment, the Secretary of Commerce suggests a tax cut (expansionary fiscal policy). Given the fixed exchange rate system, describe the effects of these two policy options on Atlantis's current account. OA. Expansionary monetary policy and expansionary fiscal policy would both improve the current account deficit. OB. Expansionary monetary policy would make the current account deficit worse, but expansionary fiscal policy would improve the current account deficit OC. Expansionary monetary policy and expansionary fiscal policy would both make the current account deficit worse. OD. Expansionary monetary policy would improve the current account deficit, but expansionary fiscal policy would make the current account deficit worse.
If the two countries operated under a floating rate system, the exchange rate would fall immediately. the quantity of exports would OA. rise in Atlantis, and the quantity of imports would rise, restoring balance. OB. fall in Atlantis, and the quantity of imports would fall, restoring balance. OC. fall in Atlantis, and the quantity of imports would rise, restoring balance. OD. rise in Atlantis, and the quantity of imports would fall, restoring balance