When the dollar appreciates, which of the following generally occurs to domestic industries with direct competition in foreign countries?
A)employment increases.
B)employment decreases.
C)employment remains the same.
D)At first employment decreases; however, as the dollar continues to increase in value, jobs become more available.

Question

Quizplus · Accepted Answer

When the dollar appreciates, the prices of domestic products increase relative to foreign products, making them less competitive. Therefore, domestic industries with direct competition in foreign countries tend to experience a decrease in sales and demand, leading to a decrease in employment.

When the Dollar Appreciates, Which of the Following Generally Occurs