SupposeJapan andTaiwan are trading, and currencies must be exchanged as goods/services are imported and exported between the twonations. The newTaiwan Dollar (TWD) is the currency ofTaiwan, and theYen () is the currency ofJapan.

Are the following statements correct or incorrect? Why or why not?

1. "IfJapan is importinga decreasing amount ofgoods fromTaiwan, these imports(produced in Taiwan and shippedtoJapan) help with creating a decreased demand for new TWD's in the Currency Exchange Market forTWD's."
2. "IfTaiwan is importing a decreasing amount of goodsproduced in Japan, these imports(produced in Japan and shippedtoTaiwan) help with creating a decreased supply ofYen ()in the Currency Exchange Market for Yen ()."

1. "IfJapan is exporting a decreasing amount of its goods to Taiwan, the decrease in exports fromJapan toTaiwancreates a decreased supplyof new TWD's in the Currency Exchange Market forTWD's."