The Figure Above Shows the Demand Curve for Dollars in the Foreign

question 82

Multiple Choice

The figure above shows the demand curve for dollars in the foreign exchange market.
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Which of the following factors could lead to an upward movement along the demand curve as indicated by the arrow?
I. An increase in the U.S. interest rate
ii. A decrease in the U.S. interest rate
Iii. An increase in the expected future U.S. exchange rate.

• A)ii only
• B)i and iii
• C)i only
• D)ii and iii
• E)None of the factors could lead to the upward movement illustrated by the arrow.

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Definitions:

Steep Mountain Front

The abrupt transition from a mountain's slope to the relatively flat terrain, typically indicating tectonic activity or erosion processes.

Deepest Marine Water

The section of the ocean that is furthermost below sea level, often located in ocean trenches.

River System

A network of rivers and streams that drain an area of land, including tributaries, main rivers, and often a delta where it meets an ocean or lake.

Deepest Marine Water

The water found at the greatest depths of the ocean, often characterized by cold temperatures and high pressure.