Last week,13 Mexican pesos could purchase one U.S.dollar.This week,it takes 11 Mexican pesos to purchase one U.S.dollar.This change in the value of the dollar will ________ exports from the United States to Mexico and ________ U.S.aggregate demand.
A)increase; increase
B)decrease; decrease
C)increase; decrease
D)decrease; increase

Question

Quizplus · Accepted Answer

The appreciation of the Mexican peso relative to the U.S. dollar makes U.S. goods cheaper for Mexican buyers, likely increasing exports from the U.S. to Mexico and thus increasing U.S. aggregate demand.

Last Week,13 Mexican Pesos Could Purchase One U