The appropriate expenditure-switching policy to correct a trade surplus is
A) currency revaluation.
B) currency devaluation.
C) expansionary monetary policy.
D) contractionary fiscal policy.

Question

Quizplus · Accepted Answer

Currency revaluation makes domestic goods more expensive for foreign buyers and foreign goods cheaper for domestic consumers, thus reducing a trade surplus by encouraging imports and discouraging exports.

The Appropriate Expenditure-Switching Policy to Correct a Trade Surplus Is