The net asset value of international stock mutual funds ____ as the dollar strengthens against foreign currencies. (Assume no change in the prices of foreign stocks.)
A)increases
B)decreases
C)is unaffected
D)can increase or decrease depending on the dollar's degree of strength

Question

Quizplus · Accepted Answer

When the dollar strengthens against foreign currencies, the net asset value of international stock mutual funds decreases. This is because the value of the foreign stocks held by the mutual fund decreases in terms of dollars.

The Net Asset Value of International Stock Mutual Funds ____