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If the Equilibrium Exchange Rate of the Dollar Is 1

Question 180

Multiple Choice

If the equilibrium exchange rate of the dollar is 1.10 euros per dollar and currently the exchange rate is 0.90 euros per dollar, then there is a ________ of dollars that leads to ________.


A) surplus; a rise in the exchange rate
B) shortage; the demand curve for dollars shifting rightward
C) surplus; the supply curve of dollars shifting leftward
D) shortage; a rise in the exchange rate
E) shortage; the supply curve of dollars shifting rightward

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