Post Utme Delsu 2017 Economics Question 26

Practice objective / multiple choice question 26 from the 2017 Post Utme Delsu Economics examination.

Post Utme Delsu 2017 Economics Objective / Multiple Choice
Question 26 POST_UTME_DELSU • 2017 • ECONOMICS • objective

The Marshall-Lerner condition states that a country will benefit from a devaluation of its currency if the sum of the price elasticities of demand for imports and exports is greater than 1. What is the implication of this condition for a country with a trade deficit?

Answer Options

A. The country will experience a decrease in its trade deficit.
Correct Answer B. The country will experience an increase in its trade deficit.
C. The country will experience no change in its trade deficit.
D. The country will experience a decrease in its trade surplus.
Correct Answer
B
Correct Option:
The country will experience an increase in its trade deficit.

About This Question

This is Post Utme Delsu 2017 Economics Question 26. It is one of the objective questions from the 2017 Post Utme Delsu Economics examination.

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