If One Dollar Is Initially Equal in Value to One

question 46

Multiple Choice

If one dollar is initially equal in value to one euro and the demand for euros increases, then each dollar will be worth _____

• A) more than one euro, and European imports will be cheaper in the United States.
• B) less than one euro, and European imports will be more expensive in the United States.
• C) more than one euro, and European imports will be more expensive in the United States.
• D) less than one euro, and European imports will be cheaper in the United States.
• E) the same as the euro, and there will be no change in the values of imports or exports.