If the interest rate on Japanese yen assets falls, the
A)quantity of dollars demanded will decrease.
B)quantity of dollars demanded will increase.
C)demand for dollars will increase.
D)demand for dollars will decrease.

Question

Quizplus · Accepted Answer

When the interest rate on Japanese yen assets falls, investors seek higher returns elsewhere, increasing the demand for dollars as they convert yen to invest in dollar-denominated assets.

If the Interest Rate on Japanese Yen Assets Falls, the