When the exchange rises, the
A) AD curve shifts rightward.
B) AD curve shifts leftward.
C) LAS curve shifts rightward.
D) LAS curve shifts leftward.

Name: When the exchange rises, the A) AD curve shifts rightward. B) AD curve shifts leftward. C) LAS curve shifts rightward. D) LAS curve shifts leftward.
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Question

Quizplus · Accepted Answer

When the exchange rate rises, domestic goods become more expensive for foreign buyers, leading to a decrease in exports. This reduces aggregate demand, causing the AD curve to shift leftward.

When the Exchange Rises, the