Economics 9708 · AS & A Level · International trade and free trade

International trade and free trade — practice question

The US and the EU both use floating exchange rate markets. The exchange rate varied sharply over the period shown. Table data: - 2000: 0.84 dollars per euro - 2008: 1.59 dollars per euro - 2022: 1.00 dollar per euro What could account for the changes in the US dollar-euro rate of exchange?

  • Achanges in the supply and demand for dollars and euros in the foreign exchange market
  • Bcontinuous appreciation of the US dollar throughout the period
  • Ccontinuous depreciation of the US dollar throughout the period
  • Drestraints placed by trade agreements on the rate of exchange

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