Other things the same,when an Australian company imports sporting equipment from the U.S.,the open-economy macroeconomic model treats this transaction as an increase in the quantity of dollars demanded in the U.S.foreign-currency exchange market.

Question

Quizplus · Accepted Answer

According to the open-economy macroeconomic model, importing goods from another country requires the buyer to exchange their domestic currency for the foreign currency of the seller. Therefore, when an Australian company imports sporting equipment from the U.S., it increases the demand for dollars in the U.S. foreign-currency exchange market.

Other Things the Same,when an Australian Company Imports Sporting Equipment