In the foreign exchange market, an increase in the world demand for U.S. exports shifts
A) demand curve for U.S. dollars leftward
B) supply curve for U.S. dollars rightward
C) demand curve for U.S. dollars rightward
D) supply curve for U.S. dollars leftward

Question

Quizplus · Accepted Answer

An increase in world demand for U.S. exports means that more foreign countries will need U.S. dollars to purchase those exports. As a result, the demand for U.S. dollars will increase, which will shift the demand curve for U.S. dollars rightward.

In the Foreign Exchange Market, an Increase in the World