An increase in Switzerland's interest rate and an increase in Switzerland's price level relative to U.S. price level have the same effect on the exchange rate between the two countries.

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An increase in Switzerland's interest rate would likely appreciate the Swiss Franc against the U.S. dollar by attracting more foreign capital due to higher returns, while an increase in Switzerland's price level relative to the U.S. would likely depreciate the Swiss Franc against the U.S. dollar due to inflationary pressures, making Swiss goods more expensive compared to U.S. goods.

An Increase in Switzerland's Interest Rate and an Increase in Switzerland's