If prices increase only in the United States,then:
A)U.S.goods become relatively more expensive than goods from other countries.
B)U.S.goods become relatively less expensive than goods from other countries.
C)the prices of foreign goods must rise.
D)None of these is true.

Question

Quizplus · Accepted Answer

If prices increase only in the United States, then goods produced in the United States become relatively more expensive than goods produced in other countries. This is because an increase in prices in the United States means that the purchasing power of the U.S. dollar decreases. As a result, imports become cheaper relative to domestically produced goods, and U.S. exports become more expensive for foreigners to buy.

If Prices Increase Only in the United States,then