If countries A and B are the only two countries in the world, then if the currency of country A appreciates, the currency of country B... O a. May appreciate or depreciate, depending on the elasticity of demand for the exports of country A. O b. May appreciate or depreciate, depending on the volume of trade between the two countries. O c. Must appreciate. O d. Can appreciate relative to other countries. O e. Must depreciate.
If countries A and B are the only two countries in the world, then if the currency of country A appreciates, the currency of country B... O a. May appreciate or depreciate, depending on the elasticity of demand for the exports of country A. O b. May appreciate or depreciate, depending on the volume of trade between the two countries. O c. Must appreciate. O d. Can appreciate relative to other countries. O e. Must depreciate.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:If countries A and B are the only two countries in the world, then if the currency of country A appreciates, the currency of
country B...
O a. May appreciate or depreciate, depending on the elasticity of demand for the exports of country A.
O b. May appreciate or depreciate, depending on the volume of trade between the two countries.
O c. Must appreciate.
O d. Can appreciate relative to other countries.
O e. Must depreciate.
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