As the U.S. dollar’s foreign-exchange value falls, we should expect to see
A. more Americans travelling abroad.
B. American import levels rising.
C. more foreigners visiting the United States.
D. increased foreign investment by American firms.
Answer: C
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Refer to the figure above. Which of the following is likely to happen if a price control of $40 is imposed?
A) There will be a surplus of 10 units in the market. B) There will be a shortage of 10 units in the market. C) There will be a surplus of 20 units in the market. D) There will be a shortage of 20 units in the market.
Refer to Figure 29-1. Currency speculators believe that the value of the euro will increase relative to the dollar. Assuming all else remains constant, how would this be represented?
A) Supply would decrease, demand would increase and the economy moves from A to D to C. B) Supply would increase, demand would increase and the economy moves from D to A to B. C) Supply would decrease, demand would decrease and the economy moves from B to C to D. D) Supply would increase, demand would decrease and the economy moves from C to B to A.