A decrease in foreign demand for U.S. exports will ____ the demand for U.S. dollars and cause the U.S. dollar to ____ in value.

Question

Quizplus · Accepted Answer

If there is a decrease in foreign demand for U.S. exports, it means that there will be fewer people wanting to buy U.S. goods and therefore fewer people needing to buy U.S. dollars to pay for those goods. This will decrease the demand for U.S. dollars and cause the value of the U.S. dollar to depreciate.

A Decrease in Foreign Demand for U