When the dollar depreciates, the cost to Americans of foreign goods
A)rises and the CPI falls.
B)rises and the CPI rises.
C)falls and the CPI rises.
D)falls and the CPI falls.

Question

Quizplus · Accepted Answer

When the dollar depreciates, the cost of foreign goods to Americans rises because more dollars are needed to buy the same amount of foreign goods. This increase in the cost of imported goods contributes to an overall increase in the consumer price index (CPI), which measures the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

When the Dollar Depreciates, the Cost to Americans of Foreign