Post Utme Uniben 2018 Economics Question 29

Practice objective / multiple choice question 29 from the 2018 Post Utme Uniben Economics examination.

Post Utme Uniben 2018 Economics Objective / Multiple Choice
Question 29 POST_UTME_UNIBEN • 2018 • ECONOMICS • objective

The Marshall-Lerner condition states that a country's balance of payments will improve if the sum of the elasticities of demand for imports and supply of exports exceeds 1. Which of the following scenarios would lead to an improvement in the balance of payments?

Answer Options

A. A 10% increase in the price of oil leads to a 5% decrease in the demand for imports.
Correct Answer B. A 5% decrease in the price of oil leads to a 10% increase in the supply of exports.
C. A 10% increase in the price of oil leads to a 10% decrease in the supply of exports.
D. A 5% decrease in the price of oil leads to a 5% increase in the demand for imports.
Correct Answer
B
Correct Option:
A 5% decrease in the price of oil leads to a 10% increase in the supply of exports.

About This Question

This is Post Utme Uniben 2018 Economics Question 29. It is one of the objective questions from the 2018 Post Utme Uniben Economics examination.

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