Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Suppose that the United States and China trade exclusively with each other. What will happen to the value of the U.S. dollar, ceteris paribus ,

Suppose that the United States and China trade exclusively with each other. What will happen to the value of the U.S. dollar,ceteris paribus, if Chinese interest rates rise significantly?

a)The U.S. dollar will appreciate.

b)The U.S. dollar will depreciate.

c)The U.S. dollar will not change in value.

I think i'ts b since there will be more demand for the american dollar based on more demand for US goods.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Essentials Of Business Law And The Legal Environment

Authors: Richard A Mann, Barry S Roberts

10th Edition

0324593562, 9780324593563

More Books

Students also viewed these Economics questions

Question

1. Build trust and share information with others.

Answered: 1 week ago