The figure above shows the Australian market for foreign exchange in 2001 and 2009.
-Which of the following could have led to the shifts illustrated in the figure above?
i. The Australian exchange rate was expected to depreciate between 2001 and 2009.
ii. The Australian exchange rate was expected to appreciate between 2001 and 2009.
iii. The Australian interest rate fell relative to interest rates in other countries between 2001 and 2009.
A) i only
B) ii only
C) iii only
D) i and iii
E) ii and iii
Correct Answer:
Verified
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