During inflation,an increase in the amount of currency available leads to:
A) overheating of the economy thereby reducing the production levels in the economy.
B) changes in the relative demand and supply conditions in the foreign exchange market.
C) a reduction in the rate of inflation thus leading to an appreciation of the currency.
D) decreased lending by banks thereby resulting in more savings.
E) a decrease in the demand of goods and services which drives currency value higher.
Correct Answer:
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