If the Exchange Rate Changes from 1 Euro Per U

question 109

Multiple Choice

If the exchange rate changes from 1 euro per U.S. dollar to 1.2 euros per U.S. dollar, the Euro has

• A) appreciated, since its value has increased.
• B) appreciated, since the price of U.S. dollars has increased.
• C) appreciated, making U.S. goods cheaper in Euros.
• D) depreciated, since its value has declined.
• E) depreciated, since its value has increased.