-Refer to Exhibit FF-2

Multiple Choice

-Refer to Exhibit FF-2. If the U.S. government wants to maintain the foreign exchange rate at 100 yen = $1, and the supply curve of dollars on the foreign exchange market shifts from S to S^', the government must

A) appreciate the dollar
B) depreciate the exchange rates of other countries
C) supply dollars to the foreign exchange market
D) demand dollars from the foreign exchange market
E) depreciate the dollar