Considering the foreign exchange market, identify four causes for an increase in the supply of dollars.
What will be an ideal response?
The supply of dollars on the foreign exchange market will increase if there is an increased preference for foreign goods. The supply can also increase if the riskiness of foreign assets decreases compared to the U.S. assets, or an increase in wealth in the U.S., or if there is an expected depreciation of the dollar.
Economics
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What will be an ideal response?
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