Multiple Choice
In the foreign exchange market, the supply curve for dollars slopes upwards because
A) as the exchange rate rises, imports become more expensive, and more dollars are supplied to pay for the imports.
B) as the exchange rate rises, imports become cheaper, and more dollars are supplied to pay for the increase in the quantity of imports.
C) as the exchange rate rises, more dollars are supplied since the profit from selling dollars falls.
D) as the exchange rate rises, exports become cheaper and more dollars are supplied to pay for the exports.
Correct Answer:
Verified
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