Which of the Following Would Tend to Raise the Value

question 48

Multiple Choice

Which of the following would tend to raise the value of the U.S. dollar in foreign exchange markets?

• A) a rise in U.S. interest rates
• B) an easy monetary policy in the United States
• C) a contractionary fiscal policy in the United States
• D) an increase in the U.S. demand for foreign oil

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Definitions:

CPI

The Consumer Price Index, a measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food, and medical care.

Inflation Rate

The velocity at which the broad price level of goods and services climbs, reducing purchasing capability.

Aggregate Demand

The total demand for all goods and services within a particular economy at a given overall price level and in a given period.

Aggregate Supply

The total output of goods and services that producers in an economy are willing and able to supply at a given overall price level in a specified time period.