Everything else equal, a decrease in the supply of dollars in exchange for pesos:
A) will cause the dollars to depreciate against the pesos and will decrease the quantity of dollars being traded in the foreign exchange market.
B) will cause the dollars to appreciate against the pesos and will increase the quantity of dollars being traded in the foreign exchange market.
C) will cause the dollars to depreciate against the pesos and will increase the quantity of dollars being traded in the foreign exchange market.
D) will cause the dollars to appreciate against the pesos and will decrease the quantity of dollars being traded in the foreign exchange market.
D
You might also like to view...
When economists say that people choose rationally, this means
a. they gather all relevant information before making their purchases b. once a pattern of behavior has been established, people tend to become set in their ways c. people respond in predictable ways to changes in costs and benefits d. people rarely make errors when they are permitted to make transactions e. once made, decisions are never reversed
When compared with the purely competitive industry with identical costs of production, a monopolist will produce:
A. More output and charge the same price B. More output and charge a higher price C. Less output and charge a higher price D. Less output and charge the same price