All of the Following Would Add to the Demand for U.S

question 138

Multiple Choice

All of the following would add to the demand for U.S. dollars except:

• A) Long-term capital inflows
• B) Foreign travel by United States citizens
• C) Exports of commodities from the United States
• D) Travel by foreigners on United States airlines

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Definitions:

Swedish Krona

The official currency of Sweden, abbreviated as SEK, used for all financial transactions within the country.

Exchange Rate

The amount one currency is worth in the units of another currency.

Relative Purchasing Power Parity

A theory that states the rate of appreciation or depreciation of one currency relative to another will equal the rate of inflation differentials between the two countries.

Expected Inflation

The rate at which the general level of prices for goods and services is rising, and subsequently, purchasing power is expected to fall.