Suppose the Supply of Dollars Increased from S₁ to S₂

question 19

Multiple Choice

Suppose the supply of dollars increased from S₁ to S₂ in Figure 36.3.As a result of this change,

• A)Swiss chocolate imports to the United States will be lower-priced.
• B)U.S.computer exports to Switzerland will be lower-priced.
• C)A trade surplus will be created in Switzerland.
• D)The Swiss franc will lose value worldwide.

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Definitions:

Equity Financing

The process of raising capital through the sale of shares in a company.

Term

The time until a debt security’s principal is due to be repaid. Also called the debt’s maturity or time until maturity.

Indirect Transfers

Transactions where assets or money move between entities or locations via intermediaries rather than through a direct exchange.

Investment Banks

Financial institutions that provide advisory services, underwriting, trading, asset management, and other financial services to corporations and governments.