An increase in the money supply will decrease both interest rates and exchange rates.

Name: An increase in the money supply will decrease both interest rates and exchange rates.
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Question

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An increase in the money supply will lead to an increase in supply of funds in the market, which will decrease interest rates due to increased competition among lenders. Decreased interest rates will lead to a decrease in exchange rates as investors will have less incentive to hold assets in that currency.

An Increase in the Money Supply Will Decrease Both Interest