International Economics 13th Edition by Robert Carbaugh

Exercise 5

Explain how the following factors affect the dollar's exchange rate under a system of market-determined exchange rates:
(a) a rise in the U.S. price level, with the foreign price level held constant;
(b) tariffs and quotas placed on U.S. imports;
(c) increased demand for U.S. exports and decreased U.S. demand for imports;
(d) rising productivity in the United States relative to other countries;
(e) rising real interest rates overseas, relative to U.S. rates;
(f ) an increase in U.S. money growth; and
(g) an increase in U.S. money demand.