Other things the same,if the U.S.real exchange rate depreciated,then U.S.net exports would
A)fall and the quantity of dollars demanded in the market for foreign-currency exchange would fall.
B)fall and the quantity of dollars demanded in the market for foreign-currency exchange would rise.
C)rise and the quantity of dollars demanded in the market for foreign-currency exchange would fall.
D)rise and the quantity of dollars demanded in the market for foreign-currency exchange would rise.

Question

Quizplus · Accepted Answer

When the U.S. real exchange rate depreciates, U.S. goods become cheaper for foreigners, leading to an increase in U.S. net exports. As a result, the demand for dollars in the foreign exchange market rises because foreign buyers need more dollars to purchase U.S. goods.

Other Things the Same,if the U