Under a System of Flexible Exchange Rates, an Increase in the Foreign

question 144

Multiple Choice

Under a system of flexible exchange rates, an increase in the foreign demand for the U.S. dollar in the foreign exchange market will cause the:

• A)​dollar to appreciate.
• B)​dollar to depreciate.
• C)​U.S.trade deficit to decrease.
• D)​U.S.inflation rate to increase.

---

Definitions:

Formal Decree

is an official order issued by a legal authority, often a court, that has a binding legal effect.

Witnesses' Signatures

The act of signing a document by someone who observes the signing process, to confirm its authenticity or the signers' agreement.

Revocation

The act of officially canceling or withdrawing a decision, offer, or legal right, often used in contexts such as contracts, wills, and powers of attorney.

Divorce

The formal termination of a marital union by a recognized authority, usually a court or a legal institution.