Which of the following would cause the supply of U.S. dollars in the forex market to decrease?
A) Foreign interest rates are low relative to U.S. interest rates.
B) Investors' confidence in foreign economies increases.
C) U.S. consumers prefer foreign goods to U.S. goods.
D) All of these would increase the supply of U.S. dollars in the forex market.

Question

Quizplus · Accepted Answer

If foreign interest rates are low relative to U.S. interest rates, investors are more likely to invest in the U.S. to take advantage of higher returns, reducing the supply of U.S. dollars in the forex market as fewer dollars are exchanged for foreign currencies.

Which of the Following Would Cause the Supply of U