As the dollar depreciates:
A) the quantity supplied of foreign exchange increases.
B) the quantity supplied of foreign exchange decreases.
C) the supply of foreign exchange decreases.
D) the supply of foreign exchange increases.
E) the supply of foreign exchange does not change.

Question

Quizplus · Accepted Answer

As the dollar depreciates, foreign goods become more expensive for Americans, leading to a decrease in imports and an increase in the quantity supplied of foreign exchange as foreigners demand more dollars to buy cheaper American goods.

As the Dollar Depreciates