Which of the following is most likely to happen as the result of lower real interest rates in the United States?
a. the dollar will depreciate on the foreign exchange market and imports will grow relative to exports.
b. the dollar will appreciate on the foreign exchange market, and exports will grow relative to imports.
c. the dollar will depreciate on the foreign exchange market, and exports will grow relative to imports.
d. the dollar will appreciate on the foreign exchange market, and imports will grow relative to exports.
C
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South Africa is a major wine producer. As Americans become more familiar with those wines and show an increased preference for them, an increased __________ the South African rand will cause the dollar to __________ relative to the rand
A) demand for; depreciate B) demand for; appreciate C) supply of; depreciate D) supply of; appreciate
Using a Laspeyres index to calculate the Consumer Price Index (CPI)
A) weights quantities with current prices. B) weights prices with base-year quantities. C) weights quantities with base-year prices. D) weights prices with current year quantities.