Other things remaining the same, as Australian imports decrease, the quantity of a.Australian dollars supplied increases....

Other things remaining the same, as Australian imports decrease, the quantity of

a.Australian dollars supplied increases.

b.Australian dollars demanded decreases.

c.foregin currency demanded decreases.

d. foreign currency supplied decreases.

Solutions

Expert Solution

Foreign currency demanded decreases.

( *Other things remaining the same, as Australian imports decrease, the quantity of foreign currency demanded decreases.

In short ,Lower imports means lower demand for foreign exchange as we don't need foreign currency to make payments for imports.

Other options are incorrect.

* As Imports decrease, Austrian dollars supplied will decrease. It wont decrease as stated.

* As Imports decrease purchses will be made using domestic currency and demand for Austrian dollars will increase. It won't decrease as stated.

* When important decrease . Net exports will improve . Exports will exceed imports. Supply of foreign currency will increase. It won't decrease as stated. )

Rahul Sunny answered 2 years ago

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