Use the following to answer questions:
-(Figure: Change in the Demand for U.S. Dollars) Refer to Figure: Change in the Demand for U.S. Dollars. A flow of capital from Europe to the United States would cause a movement in this foreign exchange market that is best represented by the shift from:

Question

Use the following to answer questions: 
-(Figure: Change in the Demand for U.S. Dollars) Refer to Figure: Change in the Demand for U.S. Dollars. A flow of capital from Europe to the United States would cause a movement in this foreign exchange market that is best represented by the shift from:

Quizplus · Accepted Answer

A flow of capital from Europe to the United States would increase demand for U.S. dollars and decrease demand for euros, shifting the demand curve for U.S. dollars to the right (D₁ to D₂) and the supply curve for euros to the left. (E₂ to E₁).

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