When the Prices of a Country's Imports Decrease, the Prices

Multiple Choice

When the prices of a country's imports decrease, the prices of domestic goods may decrease. This occurs because

A) a decrease in the prices of imported inputs will cause aggregate supply to decrease.
B) if import prices fall relative to domestic prices, households will tend to substitute domestically produced goods and services for imports.
C) if import prices fall relative to domestic prices, households will tend to substitute imports for domestically produced goods and services.
D) a decrease in the prices of imported inputs will cause aggregate demand to increase.