If Interest Rates in the United States Are Higher Than

question 8

Multiple Choice

If interest rates in the United States are higher than interest rates in Europe, what is most likely to happen?

• A)Supply of dollars will increase, causing appreciation of the dollar.
• B)Supply of euros will increase, causing appreciation of the euro.
• C)Demand for dollars will increase causing appreciation of the dollar.
• D)Demand for dollars will decrease, causing depreciation of the dollar.

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Definitions:

Crust Thicken

The process by which the Earth's crust becomes thicker as a result of tectonic forces, volcanic activities, or sediment deposition.

Accretionary Prism

A triangular accumulation of sediment and rock peeled from the surface of a subducting tectonic plate and attached to the overlying plate at a convergent boundary between plates.

Subduction Zone

A region where one tectonic plate moves under another, often leading to volcanic activity and earthquakes.

Metamorphosed Rocks

Rocks that have undergone a change in mineral composition and texture due to extreme heat and pressure conditions.