A. (3pts) Graph the International Dollar market. Label all curves and axis. Label equilibrium as $1= 65 Indian Rupee.

B.(3pts) Duplicate your graph from part A. Show what will happen in the international dollar market if India suddenly wants to increase their purchase of American goods. State if the dollar will appreciate or depreciate in value.

C. (4pts) Duplicate your graph from part B. If the exchange rate is a fixed rate at $1= 65 Indian Rupee, graphically show and state what must happen in order to return to that fixed exchange rate.