If the interest rate on Japanese yen assets falls while interest rates in the United States remain constant, the
A) quantity of dollars demanded will increase.
B) quantity of dollars demanded will decrease.
C) demand for dollars will increase.
D) demand for dollars will decrease.

Question

Quizplus · Accepted Answer

If the interest rate on Japanese yen assets falls while U.S. rates remain constant, investors will seek higher returns in the U.S., increasing the demand for dollars to invest in U.S. assets.

If the Interest Rate on Japanese Yen Assets Falls While