How increase in interest rate will affect international rate

Assignment Help International Economics

Reference no: EM13198783

The Federal Reserve decreases the money supply in the United States causing interest rates to increase.

-Show and explain how the increase in interest rates (and the international value of the dollar) will affect the international value of the United States dollar and the foreign dollar. (Make sure you use the concepts of supply and demand and financial capital in your explanation.)

-Explain how the change in interest rates will affect United States aggregate demand. (Make sure to include the determinant that causes the change in aggregate demand in your explanation.)

Reference no: EM13198783

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