If,in Retaliation for "Unfair" Trade Practices,Congress Imposes a 30 Percent

question 74

Multiple Choice

If,in retaliation for "unfair" trade practices,Congress imposes a 30 percent tariff on Japanese DVD recorders,but at the same time,U.S. demand for Japanese goods increases,then,in the long run,________,everything else held constant.

• A)the Japanese yen should appreciate relative to the U.S. dollar
• B)the Japanese yen should depreciate relative to the U.S. dollar
• C)there is no effect on the Japanese yen relative to the U.S. dollar
• D)the Japanese yen could appreciate,depreciate or remain constant relative to the U.S. dollar

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