The U.S. exchange rate rises. As a result, there is a
A) leftward shift in the U.S. aggregate demand curve.
B) rightward shift in the long-run U.S. aggregate supply curve.
C) movement along the U.S. aggregate demand curve but the curve does not shift.
D) rightward shift in the U.S. aggregate demand curve.

Question

Quizplus · Accepted Answer

When the U.S. exchange rate rises, U.S. goods become more expensive for foreign buyers, leading to a decrease in exports and a leftward shift in the aggregate demand curve.

The US Exchange Rate Rises