Under a Fixed Exchange Rate System, an Increase in Japanese

question 113

Multiple Choice

Under a fixed exchange rate system, an increase in Japanese demand for U.S.agricultural goods would

• A)cause the U.S.balance of trade to worsen
• B)increase the supply of yen relative to the dollar
• C)decrease Japanese demand for dollars
• D)cause the yen to appreciate
• E)cause an immediate revaluation of the yen

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Definitions:

Intellect

The ability to learn, understand, and apply knowledge, often seen as a component of intelligence.

Imagination

The faculty or action of forming new ideas, images, or concepts of external objects not present to the senses.

Adventurousness

The willingness or tendency to take risks and try new or challenging experiences.

Negative Correlation

When one variable is high, the other variable tends to be low.