If banks and speculators in the U.S.decided to exchange U.S.dollars for the foreign currencies of other countries,but foreigners do not desire to increase their holdings of U.S.dollars,then U.S.net exports would
A)rise and aggregate demand would shift left.
B)rise and aggregate demand would shift right.
C)fall and aggregate demand would shift left.
D)fall and aggregate demand would shift right.

Question

Quizplus · Accepted Answer

If U.S. dollars are exchanged for foreign currencies, the dollar depreciates, making U.S. goods cheaper for foreigners, thus increasing net exports and shifting aggregate demand to the right.

If Banks and Speculators in the U