During the era of dollar appreciation from 1981 to 1985 a main reason why the dollar did not fall in value was ?
Correct answer: A. flows of foreign investment into the United States
- A. flows of foreign investment into the United States
- B. rising price inflation in the United States
- C. a substantial decrease in U.S imports
- D. a substantial increase in U.S exports
Explanation
Foreign investment flowing into the United States increased demand for dollars, supporting its exchange value during 1981–1985. Inflation would tend to weaken the dollar, while lower imports or higher exports were not the main explanation.
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