Holding All Else Constant,an Increase in the Real Interest Rate

question 179

Multiple Choice

Holding all else constant,an increase in the real interest rate on U.S.assets will _________ the supply of Canadian dollars in the foreign exchange market and _________ the equilibrium U.S.dollar-Canadian dollar exchange rate.

• A) increase;increase
• B) increase;decrease
• C) not change;not change
• D) decrease;increase
• E) decrease;decrease