Post Utme Coal City University 2019 Economics Question 1

Practice objective / multiple choice question 1 from the 2019 Post Utme Coal City University Economics examination.

Post Utme Coal City University 2019 Economics Objective / Multiple Choice
Question 1 POST_UTME_COAL_CITY_UNIVERSITY • 2019 • ECONOMICS • objective

The Marshall-Lerner condition states that a country's balance of payments will improve if the sum of the percentage changes in its export and import prices is greater than the percentage change in its exchange rate. Which of the following scenarios would lead to an improvement in the balance of payments?

Answer Options

Correct Answer A. A 10% increase in export prices and a 5% decrease in import prices
B. A 5% decrease in export prices and a 10% increase in import prices
C. A 10% increase in export prices and a 10% increase in import prices
D. A 5% decrease in export prices and a 5% decrease in import prices
Correct Answer
A
Correct Option:
A 10% increase in export prices and a 5% decrease in import prices

About This Question

This is Post Utme Coal City University 2019 Economics Question 1. It is one of the objective questions from the 2019 Post Utme Coal City University Economics examination.

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