-In the figure above, the shift in the supply curve for Australian dollars from S₀to S₂could occur when A)the current exchange rate rises. B)the expected future exchange rate rises. C)the expected future exchange rate falls. D)the current exchange rate falls.

Question

Quizplus · Accepted Answer

A shift in the supply curve from S0 to S2 indicates an increase in supply. This could occur if the expected future exchange rate falls, leading holders of Australian dollars to sell them now before the value decreases further.

-In the Figure Above, the Shift in the Supply Curve