To offset an appreciation in the dollar's exchange value, the Federal Reserve can nudge interest rates down in the United States, which results in net investment outflows.

Question

Quizplus · Accepted Answer

By lowering interest rates, the Federal Reserve makes U.S. assets less attractive to foreign investors, who may then choose to invest elsewhere, resulting in net investment outflows. This can help offset an appreciation in the dollar's exchange value.

To Offset an Appreciation in the Dollar's Exchange Value, the Federal