Under a System of Flexible Exchange Rates, an Increase in Demand

Multiple Choice

Under a system of flexible exchange rates, an increase in demand for a nation's currency in the foreign exchange market will

A) cause the nation's currency to appreciate.
B) make it more expensive for the nation to import goods.
C) cause the nation's balance on current account to shift toward a surplus.
D) make it less expensive for foreigners to buy the nation's goods.