A currency appreciation should _______ net exports, and, therefore, _________aggregate demand.
A)reduce; decrease
B)reduce; reduce
C)increase; decrease.
D)None of the above is correct.

Question

Quizplus · Accepted Answer

Currency appreciation makes a country's goods more expensive to foreigners, reducing exports and increasing imports, which decreases net exports. This reduction in net exports decreases aggregate demand.

A Currency Appreciation Should _______ Net Exports, And, Therefore, _________Aggregate

A Currency Appreciation Should _ Net Exports, And, Therefore, ___Aggregate