The equilibrium exchange rate is 0.70 euros per dollar. At this exchange rate, the quantity demanded equals the quantity supplied and is $1.3 trillion a day. If the exchange rate is now 0.60 euros per dollar, then
A) there is a shortage of dollars and the exchange rate rises.
B) there is a shortage of dollars and the exchange rate falls.
C) there is a surplus of dollars and the exchange rate rises.
D) there is a surplus of dollars and the exchange rate falls.
E) there is no change.
A
Economics
You might also like to view...
The term for the Fed's day-to-day technique for controlling the stock of money is
A) discounting operations. B) interest-rate operations. C) liquidity operations. D) open market operations. E) treasury operations.
Economics
If Sony required all its retailers not to sell televisions from other companies, Sony would be engaging in what kind of activity? Is Sony's requirement legal or does it violate the Clayton Act?
What will be an ideal response?
Economics