
The United States had large and growing trade deficits between 1980 and 1985. Despite this, the value of the U.S. dollar rose during this period. Which of the following is a factor that caused this occurrence?
A) The United States attracted heavy inflows of capital from foreign investors during this period.
B) Banks in the United States offered low interest rates to investors during this period.
C) Markets across the world witnessed strong economies during this period.
D) Developed countries in Europe maintained trade equilibrium and supplied goods to underdeveloped countries.
Correct Answer:
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