if we assume that exchange rates are flexible. Will the following make the euro to depreciate or appreciate? In each case we have to consider whether there is a shift in the demand and/or supply curves of the euro. Can you show relevant diagrams:

(a) More cars are imported in Europe from Japan.

(b) Americans and Asian investors buy more euro-denominated bonds. (c) Interest rates in the Eurozone increase relative to US and Japanese interest rates.

(d) Inflation in the Eurozone is comparatively lower inflation rate than in the US and Japan.

(e) Investment in the Eurozone by Americans and is higher than European investment in the US.

(f) Speculators believe that the euro will appreciate.