A stronger dollar leads to cheaper input prices for U.S. firms because
A) U.S. workers are willing to work for less pay because of the stronger dollar.
B) U.S. producers of intermediate goods lower prices in order to benefit from the stronger dollar.
C) imports of raw materials and intermediate goods are cheaper.
D) exports of raw materials and intermediate goods are cheaper.

Question

Quizplus · Accepted Answer

A stronger dollar means that it takes fewer dollars to purchase goods from foreign countries. Therefore, importing raw materials and intermediate goods becomes cheaper, leading to lower input prices for U.S. firms.

A Stronger Dollar Leads to Cheaper Input Prices for U