If the dollar appreciates,how will aggregate demand in the United States be affected?
A)Aggregate demand will shift to the right as exports increase.
B)Aggregate demand will shift to the right as imports increase.
C)Aggregate demand will shift to the left as imports increase.
D)Aggregate demand will shift to the left as exports increase.

Question

Quizplus · Accepted Answer

When the dollar appreciates, imports become relatively cheaper and therefore increase. This leads to an increase in supply of foreign goods, resulting in a decrease in demand for domestic goods. As a result, aggregate demand in the United States will shift to the left as imports increase.

If the Dollar Appreciates,how Will Aggregate Demand in the United