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$1.00 Why does the U.S. dollar fluctuate with other currencies? Explain thoroughly this with regard to

  • From Economics: General-Economics
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  • Due on Jun. 20, 2011
  • Asked on Jun 17, 2011 at 9:24:26PM
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rn2010
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Q:
Why does the U.S. dollar fluctuate with other currencies? Explain thoroughly this with regard to (a) interest rates (b) trade deficits
 

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  • Posted on Jun 17, 2011 at 9:38:42PM
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kefrylangel
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Preview: ... nd other assets such as securities. When U.S. exports and assets become cheaper, imports and foreign investments become more expensive, and the dollar may weaken. Foreign investors have more dollars to purchase U.S. goods and services than vice versa. In contrast, when imports and foreign assets become cheaper, exports and U.S. investments become more expensive, and the dollar ma ...
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