U.s. dollars-mexican pesos exchange rate is fixed

Assignment Help Business Economics

Reference no: EM13984527

Suppose that the U.S. dollars-Mexican pesos exchange rate is fixed by the U.S. and Mexican governments. Assume also that labor is mobile between the United States and Mexico due to low transportation costs. Which of the following situations is likely to happen as a result of a simultaneous decrease in the demand for U.S. goods and increase in the demand for Mexican goods?

a. The U.S. unemployment rate rises at first, but it soon drops as unemployed Americans move to Mexico for employment.

b. The U.S. unemployment rate rises at first, but then it drops as U.S. dollars depreciate against Mexican pesos.

c. The U.S. unemployment rate increases, and the country undergoes bad economic times for a sustained period.

d. The Mexican unemployment rate increases, and the country undergoes bad economic times for a sustained period.

Reference no: EM13984527

Questions Cloud

Demand for labor is a derived demand because : We say that the demand for labor is a derived demand because:

Principle stated by tom peters : Select, train and ________ the employees to work for the customers is a principle stated by Tom Peters in "The Service Edge".

Network externalities affect firm operating strategies : Explain why the cost structure associated with many kinds of information goods and services might imply a market supplied by a small number of large firms. (At the same time, one internet business such as grocery home deliveries have continually suff..

Calculate the amount and sign of the charge inside the box : You measure the electric field all over the surface of an opaque cylindrical box. Calculate the amount and sign of the charge inside the box.

U.s. dollars-mexican pesos exchange rate is fixed : Suppose that the U.S. dollars-Mexican pesos exchange rate is fixed by the U.S. and Mexican governments. Assume also that labor is mobile between the United States and Mexico due to low transportation costs. Which of the following situations is likely..

Contracts-agreement and consideration : 1. In the context of an offer, how are intent and its seriousness determined? 2. Why must a contract have "reasonably definite terms" and how "definite" must the terms be?

Calculate the gross pay of a set of employees : Write a C program that will calculate the gross pay of a set of employees - Calculate and print the total sum of Wage, Hours, Overtime, and Gross values

Data arrangement technology : Data Warehousing is seen as a Data Arrangement technology adopting one of the following:

What quantity is plotted on the vertical vs horizontal axis : The physical quantity that the wave represents. In your drawing, what quantity is plotted on the vertical axis vs. horizontal position in the tube?

User Account

All Pages