In the open-economy macroeconomic model,other things the same,which of the following both make the exchange rate fall?
A)U.S.investment demand falls and foreign demand for U.S.goods falls
B)U.S.investment demand falls and foreign demand for U.S.goods rises
C)U.S.investment demand rises and foreign demand for U.S.goods falls
D)U.S.investment demand rises and foreign demand for U.S.goods rises

Question

Quizplus · Accepted Answer

When U.S. investment demand falls and foreign demand for U.S. goods falls, there will be a decrease in demand for U.S. dollars in foreign exchange markets which will result in a fall in the exchange rate.

In the Open-Economy Macroeconomic Model,other Things the Same,which of the Following