An Increase in the Foreign Interest Rate Causes the Demand

question 16

Multiple Choice

An increase in the foreign interest rate causes the demand for domestic assets to ________ and the domestic currency to ________,everything else held constant.

• A)increase;appreciate
• B)increase;depreciate
• C)decrease;appreciate
• D)decrease;depreciate

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Definitions:

Monthly Income

The total amount of money earned or received by an individual or household within the span of a month.

Beer

An alcoholic beverage made from fermented grains, primarily barley, with hops adding flavor.

Price

The financial expectation, necessity, or contribution made as payment for something.

Beer

An alcoholic beverage made from the fermentation of cereal grains, primarily barley, with water, hops, and yeast.