Going Back to When France and Germany Had Separate Currencies

Multiple Choice

Going back to when France and Germany had separate currencies, if there was a shift in demand away from French goods and towards German goods, then

A) there would be an increase in the rate of inflation in France.
B) there would be an increase in unemployment in Germany.
C) the foreign exchange value of the French franc would fall, thus making French goods relatively cheaper, leading to an increase in aggregate demand for France's output that would offset the initial reduction in aggregate demand.
D) the foreign exchange value of the French franc would rise, thus making French goods relatively more expensive and so leading to an reduction in aggregate demand for France's output that would worsen the initial reduction in aggregate demand.