In the foreign exchange market between the Swiss franc and the U.S. dollar, if the supply of francs increases and the demand for francs decreases, the equilibrium quantity of Swiss francs will definitely increase.

Question

Quizplus · Accepted Answer

If the supply of francs increases and the demand for francs decreases, the equilibrium price of francs will decrease. The quantity of francs exchanged will depend on the magnitude of the change in supply and demand. It is possible for the quantity to increase, decrease, or remain the same. Therefore, the statement is false.

In the Foreign Exchange Market Between the Swiss Franc and the U.S