1. A(n) ________ of a nation's currency will cause imports to ________ and exports to ________, all other things held constant.

A) depreciation; increase; decrease

B) appreciation; decrease; increase

C) depreciation; decrease; increase

D) appreciation; increase; increase

E) depreciation; decrease; decrease

Explain your answer with a SHORT sentence.

Q2-Calculate the Expected Dollar Depreciation Rate against the euro and the expected dollar return on euro deposits if the expected exchange rate is S1.10 per euro. Expected Dollar Depreciation Rate Expected Dollar Return on Euro Deposits Today's Dollar/Euro Exchange Rate Es/e 1.10 1.08 1.06 1.04 1.02 Interest Rate on Euro Deposits Re 0.03 0.03 0.03 0.03 0.03 Against Euro (1.10-Ese)/E$/C Re+ (1.10-Ese/Ese Explain the relationship between the values on the first and the last columns