Consider the simultaneous equilibrium in the US money market and the foreign exchange market (as presented in Ch. 4). In this problem, we will analyze the effect of a decline in the euro interest rate.

Start with the US money market equilibrium. As a result of a decline in the euro interest rate, while all other exogenous variables remain unchanged:

• The US real money supply curve will ('shift right', 'shift left', or 'remain unchanged').
• The US aggregate real money demand ( 'shift right', 'shift left', or 'remain unchanged').
• The interest rate in the US will (rise, fall, or 'remain unchanged').

When it comes to the foreign exchange market:

• The curve that will be directly affected by the decline in the euro interest rate is the (return on dollar or dollar return on euro) deposits curve.
• This curve will shift (right or left).
• As a result, the dollar will (appreciate, depreciate, or remain unchanged).

Please tell me which one in the parenthesis is the correct option