In the Early 2000s, the Dollar Depreciated Relative to Other

question 39

Multiple Choice

In the early 2000s, the dollar depreciated relative to other currencies. Foreign policy makers claimed that the U.S. government must curtail its spending and encourage its citizens to save more. What does the U.S. saving rate have to do with the value of the dollar?

• A)Nothing; those who are giving this advice do not understand economics.
• B)More savings would mean more investment, and more investment would increase the value of the dollar.
• C)More domestic saving would increase the interest rate, attracting more funds to the United States and thereby raising the value of the dollar.
• D)More U.S. savings would reduce the consumption of foreign goods, reducing the trade deficit.

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Definitions:

E-Commerce

The buying and selling of goods and services through the internet, including the transfer of money and data to execute these transactions.

Virtual Account Number

A unique identifier used in financial transactions to represent a user's actual account information securely, often to protect financial data in online transactions.

Electronic Payment

Electronic payment refers to a method of making transactions or paying for goods and services through electronic means over the internet, without the use of check or cash.

Wire Transfer

An electronic method of moving funds from one bank or credit institution to another, often used for large transactions.