If there is an increase in the demand for U.S. automobiles, the
A) demand for dollars will fall.
B) demand for dollars will rise.
C) supply of dollars will fall.
D) supply of dollars will rise.

Question

Quizplus · Accepted Answer

An increase in the demand for U.S. automobiles will lead to an increase in exports, resulting in an increase in the demand for U.S. dollars. This is because foreign buyers will need to purchase U.S. dollars in order to pay for the automobiles, increasing the demand for the currency.

If There Is an Increase in the Demand for U