Given Pus and Yus, An increase in the European money supply causes the euro to depreciate against the dollar, but it does not disturb the U.S. money market equilibrium.
举一反三
- Given Pus and Yus, when the money supply rises, the dollar interest rate declines and the dollar appreciates against the euro.
- If the Fed wants to depreciate the U.S. dollar against the British pound, it will ________. A: sell foreign exchange B: decrease the money supply C: sell British pounds D: sell U.S. dollars
- In the foreign exchange market, what could be a possible consequence of an increase in the purchase of stocks of Toyota, a Japanese automobile firm, by U.S. residents? A: Demand for the dollar will increase B: Yen will depreciate C: The dollar will depreciate D: The supply curve for the dollar will shift to the left
- The predecessor of European Money market is European dollar market, which was generated in the ( ). A: 1950s B: 1920s C: 1970s D: 1980s
- Which one of the following statements is the MOST accurate? A: A rise in the interest rate offered by dollar deposits causes the dollar to appreciate. B: A rise in the interest rate offered by dollar deposits causes the dollar to depreciate. C: A rise in the interest rate offered by dollar deposits does not affect the U.S. dollar. D: For a given euro interest rate and constant forward exchange rate, a rise in the interest rate offered by dollar deposits causes the dollar to appreciate.