A decrease in U.S.real interest rates causes the dollar to _________________,which tends to __________________ U.S.Real GDP.

Question

Quizplus · Accepted Answer

A decrease in U.S. real interest rates makes U.S. assets less attractive to foreign investors, leading to a depreciation of the dollar. A weaker dollar makes U.S. exports cheaper and imports more expensive, which can increase net exports and raise U.S. Real GDP.

A Decrease in U