ECONOMICS
TRADE EXCHANGE AND INTERDEPENDENCE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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European consumers would have more purchasing power in US
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US consumers can buy more European goods and services for fewer $$
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US consumers can buy more English goods and services for fewer $$
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European tourists to the US will spend more $$
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Detailed explanation-1: -Answer and Explanation: If the value of the euro appreciates in contrast to dollars, it will make the euro more expensive compared to dollars; in other words, less euro can now buy more dollars. So, this currency can now command more American goods than earlier which increases the demand for American goods by the EU.
Detailed explanation-2: -What might cause the value of the US dollar to appreciate in the relationship to Euro? Increased demand for the U.S products if europe.
Detailed explanation-3: -An appreciation in the real exchange rate means that one U.S. good gives you more of foreign goods. This makes sense as your local products are getting more expensive, each one of them should be able to provide you with more foreign goods, everything else being equal.