A change in which of the following changes the supply of dollars and shifts the supply curve of dollars?
I. An increase in the exchange rate.
II. A change in interest rates.
III. A decrease in the expected future exchange rate.
A) II and III
B) I and II
C) I, II, and III
D) I

Question

Quizplus · Accepted Answer

A change in interest rates and a decrease in the expected future exchange rate can affect the supply of dollars by influencing investors' decisions to hold or sell dollars, thus shifting the supply curve.

A Change in Which of the Following Changes the Supply