In the foreign exchange market, a change in which of the following will result in a movement along the demand curve for U.S. dollars?
A) the exchange rate
B) the U.S. interest rate
C) the interest rate in the foreign country
D) the expected future exchange rate

Question

Quizplus · Accepted Answer

A movement along the demand curve for U.S. dollars is caused by a change in the exchange rate itself, not by changes in interest rates or expectations about future exchange rates, which would shift the demand curve.

In the Foreign Exchange Market, a Change in Which of the Following