Economics 0455 · IGCSE · Foreign exchange rates

Foreign exchange rates — practice question

The diagram illustrates the market for the Indian rupee in US$. What would make the demand curve for rupees move from $D_1$ to $D_2$?

  • Aa fall in Indian exports to the US
  • Ba fall in the US inflation rate
  • Ca rise in foreign direct investment into India
  • Da rise in interest rates in the US

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