All else being equal,a decrease in foreign interest rates relative to U.S.interest rates causes the supply of dollars to ________ and the dollar will ________ relative to foreign currencies.

Question

Quizplus · Accepted Answer

A decrease in foreign interest rates makes U.S. investments more attractive, reducing the supply of dollars as fewer investors exchange dollars for foreign currencies, leading to an appreciation of the dollar.

All Else Being Equal,a Decrease in Foreign Interest Rates Relative