-Refer to Exhibit FF-3

Multiple Choice

-Refer to Exhibit FF-3. 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) increase the demand for dollars from the foreign exchange market
B) depreciate the dollar
C) supply dollars to the foreign exchange market
D) depreciate the exchange rates of other currencies
E) appreciate the dollar