A decrease in U.S. interest rates will, other things equal, tend to:

Question

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When U.S. interest rates decrease:
A) The demand for U.S. dollars decreases, resulting in a lower foreign exchange value of the dollar.
B) The decrease in interest rates makes borrowing cheaper, which lowers the cost of capital for firms, encourages investment, and consequently, helps U.S. exporters remain competitive in the global market.
C) Investors may find other countries with higher interest rates more attractive, leading to a net outflow of capital from the U.S. Therefore, a decrease in U.S. interest rates tends to do all of the above.

A Decrease in U