Easy monetary policy will ________ net exports as a result of a ________ currency.
A)increase; stronger
B)increase; weaker
C)decrease; weaker
D)decrease; stronger

Question

Quizplus · Accepted Answer

Easy monetary policy lowers domestic interest rates which cause domestic currency to flow outward. This causes a deprecation of the dollar, which increases net exports as Americans buy fewer imports and foreigners buy more American goods.

Easy Monetary Policy Will ________ Net Exports as a Result