Which statement best describes the law of demand as it relates to currency markets?
A) The law of demand only applies to goods and services, not currency.
B) When the price of a Mexican peso in terms of a U.S.dollar decreases, U.S.consumers demand fewer Mexican pesos because Mexican goods become more expensive to American consumers.
C) When the price of Japanese yen in terms of a U.S.dollar decreases, U.S.consumers demand more Japanese yen because Japanese goods become more expensive to American consumers.
D) When the price of a Canadian dollar in terms of a U.S.dollar increases, U.S.consumers demand fewer Canadian dollars because Canadian goods become more expensive to American consumers.
E) When the price of an Australian dollar in terms of a U.S.dollar increases, U.S.consumers demand more Australian dollars because Australian goods become less expensive to American consumers.
Correct Answer:
Verified
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