When interest rates in the United States increase:
A) more foreigners will invest in U.S. assets.
B) fewer foreigners will invest in U.S. assets.
C) more U.S. citizens will invest abroad.
D) fewer U.S. citizens will invest in U.S. assets.

Question

Quizplus · Accepted Answer

When interest rates in the United States increase, U.S. assets become more attractive to foreigners because they can earn a higher return on their investments compared to their home country or other countries. This leads to an increase in foreign investment in U.S. assets.

When Interest Rates in the United States Increase