An area in which the United States has had a sizable surplus in its balance of payments is sales of ____ to foreigners

When the Fed raises the federal funds rate, eventually there is

A) an upward movement along the investment demand curve and the aggregate demand curve shifts leftward. B) an upward movement along the investment demand curve and the aggregate demand curve shifts rightward. C) a leftward shift of the investment demand curve and the aggregate demand curve shifts leftward. D) an upward movement along the investment demand curve and along the aggregate demand curve. E) a leftward shift of both the aggregate demand curve and the aggregate supply curve.

Refer to the graph below. If currency traders think the European economy will experience a recession and the U.S. economy will not, then this event will most likely cause the:

Assume that U.S. and European governments adopt a system of flexible exchange rates, and the figure below shows the market for euros.



A. Euro to appreciate
B. Euro to depreciate
C. U.S. dollar to depreciate
D. The supply of euros to decrease