In the foreign exchange market, what could be a possible consequence of an increase in the purchase of stocks of Toyota, a Japanese automobile firm, by the U.S. residents?

Question

Quizplus · Accepted Answer

When U.S. residents purchase stocks of Toyota, they need to convert their dollars into yen to make the purchase. This increases the demand for yen and the supply of dollars in the foreign exchange market, leading to a depreciation of the dollar.

In the Foreign Exchange Market, What Could Be a Possible