The exchange value of the U.S. dollar relative to other currencies does not impact international trade balances.

Question

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The exchange value of the U.S. dollar relative to other currencies can impact international trade balances. If the U.S. dollar appreciates in value, American goods become more expensive for foreign buyers, which can lead to a decrease in exports and an increase in imports, resulting in a trade imbalance. Likewise, if the U.S. dollar depreciates, American goods become more attractive to foreign buyers, which can lead to an increase in exports and a decrease in imports, resulting in a trade surplus.

The Exchange Value of the U