A primary reason that explains the appreciation in the value of U.S dollar would be ?
Correct answer: D. high interest rates in the United States
- A. large trade surpluses for the United States
- B. high inflation rates in the United States
- C. lack of investor confidence in U.S money policy
- D. high interest rates in the United States
Explanation
High U.S. interest rates raise the return on dollar-denominated assets and attract foreign investment. The resulting demand for dollars tends to appreciate the dollar.
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The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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