Asked by Tristen Adams on Jul 25, 2024
Verified
Other things being equal, the international value of foreign currencies will increase against the U.S. dollar if
A) U.S. citizens reduce spending on imports.
B) the U.S. Federal Reserve raises real interest rates.
C) the number of foreign tourists in the United States increases.
D) foreigners withdraw funds from U.S. money markets.
International Value
The worth of a product or service recognized across different countries and cultures, often influencing its global marketability and pricing.
Real Interest Rates
The interest rate adjusted for inflation, representing the true cost of borrowing and the real yield to investors.
U.S. Dollar
The official currency of the United States, often used as the global standard for financial transactions.
- Investigate how macroeconomic indicators like inflation and interest rates influence currency valuations.
Verified Answer
Learning Objectives
- Investigate how macroeconomic indicators like inflation and interest rates influence currency valuations.
Related questions
When Real Interest Rates in Other Countries Rise Relative to ...
According to the Relative Purchasing Power Parity Theory, High Inflation ...
Assume That the Inflation Rate in Canada Is 3% Over ...
If Real Interest Rates Rise in the United Kingdom Relative ...
If Currency Speculators Believe South Korea Will Have Much Lower ...