The graph of demand for a currency is a line that slopes down to the right,which indicates that demand:
A)increases as the value of the currency increases.
B)increases as the units of currency bought increases.
C)decreases as the value of the currency increases.
D)decreases as the units of the currency bought decreases.

Question

Quizplus · Accepted Answer

The downward slope of the demand curve for a currency means that as the value of the currency increases (i.e. becomes more expensive), the quantity of that currency demanded by buyers decreases. This is because as the currency becomes more expensive, buyers will need to spend more of their own currency to acquire it, making it less attractive to buy. Conversely, as the value of the currency decreases (i.e. becomes cheaper), the quantity demanded by buyers increases because it is easier and cheaper to acquire.

The Graph of Demand for a Currency Is a Line