In 1985, the exchange rate between the U.S. dollar and the Japanese yen was $1 = 262 yen; in 2003, the rate was $1 = 110 yen. Between 1985 and 2003, the
A) dollar appreciated in value relative to the yen.
B) yen appreciated in value relative to the dollar.
C) dollar price of yen fell.
D) yen price of dollars rose.

Question

Quizplus · Accepted Answer

The yen appreciated in value relative to the dollar. In 1985, it took 262 yen to purchase one U.S. dollar, but by 2003, it only took 110 yen to purchase one U.S. dollar. This means that the yen became stronger relative to the U.S. dollar over this time period.

In 1985, the Exchange Rate Between the U