Which of the following does not result in a change in the demand for foreign currency?

Question

Quizplus · Accepted Answer

Changes in foreign currency supply would affect the exchange rate, but not the demand for foreign currency. A decrease in foreign currency supply would lead to an appreciation of the domestic currency, making foreign goods relatively cheaper and increasing the demand for foreign currency. However, this is a change in the exchange rate, not the demand for foreign currency itself. Changes in interest rates, income, and tastes of foreign consumers would all affect the demand for foreign currency.

Which of the Following Does Not Result in a Change