Post Utme Crawford University 2025 Economics Question 19

Practice objective / multiple choice question 19 from the 2025 Post Utme Crawford University Economics examination.

Post Utme Crawford University 2025 Economics Objective / Multiple Choice
Question 19 POST_UTME_CRAWFORD_UNIVERSITY • 2025 • 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 is a correct interpretation of the Marshall-Lerner condition?

Answer Options

A. The Marshall-Lerner condition implies that a country's balance of payments will improve if its export prices increase and import prices decrease.
B. The Marshall-Lerner condition states that a country's balance of payments will improve if its exchange rate appreciates and its export prices increase.
Correct Answer C. The Marshall-Lerner condition implies 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.
D. The Marshall-Lerner condition states that a country's balance of payments will improve if its exchange rate depreciates and its import prices decrease.
Correct Answer
C
Correct Option:
The Marshall-Lerner condition implies 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.

About This Question

This is Post Utme Crawford University 2025 Economics Question 19. It is one of the objective questions from the 2025 Post Utme Crawford University Economics examination.

View More Post Utme Crawford University 2025 Economics Questions More Post Utme Crawford University Practice Questions Back to Questions

Master the Exam!

You've seen a preview, but there are thousands more questions plus AI tutor to break down complex solutions.

Unlock Full Access Available for Android & Windows
Chat with Support