Scenario 33-1 Suppose That Political Instability in Other Countries Makes People Fear

Multiple Choice

Scenario 33-1
Suppose that political instability in other countries makes people fear for the value of their assets in these countries so that they desire to purchase more U.S assets.
-Refer to Scenario 33-1. What would happen to the dollar?

A) It would appreciate in foreign exchange markets making U.S.goods more expensive compared to foreign goods.
B) It would appreciate in foreign exchange markets making U.S.goods less expensive compared to foreign goods.
C) It would depreciate in foreign exchange markets making U.S.goods more expensive compared to foreign goods.
D) It would depreciate in foreign exchange markets making U.S.goods less expensive compared to foreign goods.