The demand curve for U.S. dollars slopes downward because as the dollar ________ U.S. goods become ________ expensive to foreign residents, so they purchase fewer U.S. goods, and the quantity of dollars demanded decreases.

Question

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When the dollar appreciates, U.S. goods become more expensive to foreign residents, leading to a decrease in the quantity of dollars demanded as they purchase fewer U.S. goods.

The Demand Curve for U