All other things unchanged, a decrease in the value of the dollar against the euro _____ U.S. net exports and shifts the aggregate demand curve to the _____.

Question

Quizplus · Accepted Answer

A decrease in the value of the dollar against the euro makes U.S. goods relatively cheaper for Europeans, increasing their demand for U.S. exports. This results in an increase in net exports (exports - imports). As a result, there is an increase in aggregate demand, which shifts the AD curve to the right.

All Other Things Unchanged, a Decrease in the Value of the Dollar