Multiple Choice
You have just noticed that the dollar appreciated and you suspect that the American government was behind this change.Which would you choose as the most likely cause of this appreciation in the real exchange rate?
A) An increase in the money supply
B) A decrease in the money supply
C) A temporary increase in government purchases
D) A temporary decrease in taxes
Correct Answer:

Verified
Correct Answer:
Verified
Q7: According to the classical model,an increase in
Q16: Under a system of fixed exchange rates,what
Q38: Suppose the real exchange rate is 10,the
Q54: An improvement in the quality of U.S.goods
Q61: A decline in the exchange rate could
Q79: From 1980 to 2000,the yen-dollar exchange rate
Q87: A shift in demand toward the home
Q98: According to the J curve,the rapid depreciation
Q99: Suppose the Swiss franc rises against the
Q105: Monetary policy in the European Monetary Union