Question

The Marshall-Lerner Condition explains the requirement for a currency devaluation to successfully improve a country's trade balance in the long run. According to this rule, the trade balance will improve only if the sum of the price elasticities of demand for exports (Ex) and imports (Em) is _____

A Equal to zero (Ex + Em = 0)
B Less than one (Ex + Em <1)
C Exactly equal to one (Ex + Em = 1)
D Greater than one (Ex + Em > 1)
E Greater than the country's GDP growth rate (Ex + Em > GDP rate)
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