If Inflation in the United States Is Higher Than in Japan,what

question 131

Multiple Choice

If inflation in the United States is higher than in Japan,what will happen to the exchange rate between the U.S.dollar and the Japanese yen?

• A)The dollar and yen will both depreciate.
• B)The dollar and yen will both appreciate.
• C)The dollar will depreciate and the yen will appreciate.
• D)The dollar will appreciate and the yen will depreciate.

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Definitions:

Future Crises

Potential, unforeseen events that could lead to severe economic, social, or environmental problems.

Low-Interest Rate Policy

A monetary policy strategy used by central banks to maintain low borrowing costs to stimulate economic growth.

Housing Prices

The cost to purchase a residential property, which fluctuates based on demand, location, and economic conditions.

Lending Standards

The criteria used by lenders to determine the creditworthiness of potential borrowers.