If the exchange rate rises, then the quantity of dollars demanded_{--------------------} because with the higher U.S. exchange rate, U.S. exports_{--------------------} .

Question

Quizplus · Accepted Answer

When the exchange rate rises, U.S. goods become more expensive for foreign buyers, leading to a decrease in U.S. exports. Consequently, the quantity of dollars demanded decreases as there is less need for foreign buyers to exchange their currency for dollars to purchase U.S. goods.

If the Exchange Rate Rises, Then the Quantity of Dollars