Final answer:
When the euro falls in value relative to other currencies, European exports rise in price and goods imported into Europe also rise in price.
Therefore, the correct answer is a). Goods imported into Europe rise in price. and b). European exports rise in price.
Step-by-step explanation:
When the euro falls, it means that the euro becomes weaker compared to those currencies.
This has implications for European exports and imports.
a). Goods imported into Europe rise in price. Conversely, when the euro falls, it becomes more expensive for Europeans to purchase goods from other countries.
In this case, the price of imported goods into Europe tends to rise as European buyers need to pay more euros to acquire the same amount of foreign currency needed for imports.
b). European exports rise in price. When the euro falls, European goods become relatively cheaper for buyers from other countries.
As a result, the price of European exports tends to rise because buyers can acquire more euros with their own currency, making European goods more expensive.
Therefore, the correct answer is b). European exports rise in price and a). Goods imported into Europe rise in price.