Under a floating exchange rate system, a long-run monetary expansion in the European money supply can be expected to have what kind of effect on the US economy and why? A. No effect, since the exchange rate will return to its long-run (equilibnum value) B. No effect on output: the US current account will permanently improve due to the higher value of the euro relative to the do ar C. No effect on outout and on the Us current account. Prices in Europe will eventually rise and this will wipe out any short-run improvement in the European current account relative to the Us current account due to the depreciation of the euro. D. No effect on output and on the US current account. Any short-run improvement in the US current account will be eliminated, due to the fact that the increase in demand for Us made products will increase US prices which in turn will increase US imports and decrease US exports abroad E. None of the above

In recent years, it has been suggested that both china and the US have engaged in currency manipulation or "competitive devaluations'. All else the same, from this we can conclude: A. Chinese goods will be less expensive in US markets in the short-run, but US goods will be more expensive in China. B. US goods will be less expensive in China in the short-run, but Chinese goods will be more expensive in the US. C. Chinese and US made goods will be cheaper in both China and the US. D. Chinese and US made goods will be cheaper in markets outside the US and China that do not tie their currencies to the US dollar or the Renminbi.