If the Exchange Rate Falls,U.S.residents Pay

question 19

Multiple Choice

If the exchange rate falls,U.S.residents pay

• A)more dollars for foreign bonds and get more dollars from interest payments.
• B)more dollars for foreign bonds but get fewer dollars from interest payments.
• C)fewer dollars for foreign bonds and also get fewer dollars from interest payments.
• D)fewer dollars for foreign bonds but get more dollars from interest payments.

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Definitions:

Tax Revenue

The income governments procure through the levy of taxes.

Consumer Surplus

The variance between the total consumers are prepared to invest in a good or service and what they end up investing.

Producer Surplus

The difference between the amount producers are willing to accept for a good or service and the higher market price they actually receive.

Tax Revenue

Funds acquired by governments from taxation, employed to support public programs and fulfill government responsibilities.