The value of a dollar

Question

Quizplus · Accepted Answer

The value of a dollar varies inversely with the price level, meaning that as the price level increases, the value of a dollar decreases. This relationship is due to inflation, which reduces the purchasing power of dollars. The U.S. government does have some control over the value of the dollar through its monetary policies, but other factors such as international trade and market demand also play a role. The value of the dollar is not directly tied to the purchasing power of other major currencies.

The Value of a Dollar