Multiple Choice
Consider the following scenario. Inflation in Argentina pushes the price of Argentine wine up 25%. Inflation in the United States pushes the price of California wine up 10%. If the exchange rate remains constant, the U.S. demand for wine from Argentina
A) decreases.
B) increases.
C) remains constant.
D) California wine is better than Argentine wine, so there never is a U.S. demand for wine from Argentina.
Correct Answer:
Verified
Correct Answer:
Verified
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