Figure 36-5

-Which of the graphs in Figure 36-5 are consistent with a depreciation of the U.S.dollar and an increase in net exports caused by a decrease in U.S.interest rates?
A)1
B)2
C)3

Question

Figure 36-5
​ 
-Which of the graphs in Figure 36-5 are consistent with a depreciation of the U.S.dollar and an increase in net exports caused by a decrease in U.S.interest rates?
A)1 
B)2 
C)3

Quizplus · Accepted Answer

Graph 2 shows a depreciation of the U.S. dollar (the exchange rate for the U.S. dollar falls), and an increase in net exports caused by a decrease in U.S. interest rates (the net export line shifts upward). Graphs 1, 3, and 4 do not show consistent patterns with this scenario.

Figure 36-5 ​

Figure 36-5