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-Refer to Exhibit FF-4

Question 60

Multiple Choice

-Refer to Exhibit FF-4. If the U.S. government wants to maintain the foreign exchange rate at 100 yen = $1, and the demand for dollars on the foreign exchange market shifts from D to D<sup>'</sup>, the government must A) depreciate the exchange rate of other currencies B) supply dollars to the foreign exchange market C) demand dollars from the foreign exchange market D) depreciate the dollar E) appreciate the dollar
-Refer to Exhibit FF-4. If the U.S. government wants to maintain the foreign exchange rate at 100 yen = $1, and the demand for dollars on the foreign exchange market shifts from D to D', the government must


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

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