As the Relative Expected Return on Dollar Deposits Increases

question 39

Multiple Choice

As the relative expected return on dollar deposits increases,

• A) foreigners will want to hold fewer dollar deposits and more foreign deposits.
• B) Americans will want to hold more dollar deposits and less foreign deposits.
• C) Americans will want to hold fewer dollar deposits and more foreign deposits.
• D) Americans and foreigners will be indifferent toward holding dollar deposits or foreign deposits.

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