An increase in the value of the U.S.dollar relative to the Japanese yen will
A)increase aggregate demand in the United States.
B)decrease aggregate supply in the United States.
C)increase aggregate demand in Japan.
D)increase aggregate supply in Japan.

Question

Quizplus · Accepted Answer

An increase in the value of the U.S. dollar relative to the Japanese yen will make American goods more expensive for Japanese consumers and Japanese goods relatively cheaper for American consumers. This will lead to an increase in demand for Japanese goods and therefore an increase in aggregate demand in Japan.

An Increase in the Value of the U