Under a system of floating exchange rates relatively low productivity and high inflation rates in the United States results in a (an) ?

A. increase in the demand for foreign currency a decrease in the supply of foreign currency and a depreciation in the dollar
B. increase in the demand for foreign currency an increase in the supply of foreign currency and a appreciation in the dollar
C. decrease in the demand for foreign currency a decrease in the supply of foreign currency and a depreciation in the dollar
D. decrease in the demand for foreign currency and increase in the supply of foreign currency and a appreciation in the dollar

Correct Answer: increase in the demand for foreign currency a decrease in the supply of foreign currency and a depreciation in the dollar ✔

Last Updated: June 11, 2019