Supply Demand QUANTITY OF DOLLARS Refer to the figure above. When American travelers spend money overseas, that is part of U.S. imports. When foreigners come to the U.S. and spend money, that is part of U.S. exports. If after the pandemic there is a permanent reduction in overseas travel by U.S. residents but foreign travel to the U.S. comes back, which curve in the figure would shift and in which direction? The demand curve in graph (a) would shift to the right. The supply curve in graph (c) would shift to the right. The demand curve in graph (c) would shift to the right. REAL EXCHANGE RATE
Supply Demand QUANTITY OF DOLLARS Refer to the figure above. When American travelers spend money overseas, that is part of U.S. imports. When foreigners come to the U.S. and spend money, that is part of U.S. exports. If after the pandemic there is a permanent reduction in overseas travel by U.S. residents but foreign travel to the U.S. comes back, which curve in the figure would shift and in which direction? The demand curve in graph (a) would shift to the right. The supply curve in graph (c) would shift to the right. The demand curve in graph (c) would shift to the right. REAL EXCHANGE RATE
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter19: The Basic Tools Of Finance
Section: Chapter Questions
Problem 1CQQ
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