Question

If the u. S. Dollar appreciates and prices remain the same at home and abroad, foreign goods become ________ expensive relative to american goods, pushing the u. S. Trade balance toward ________.

Answer 1

If the u. S. Dollar appreciates and prices remain the same at home and abroad, foreign goods become less expensive relative to American goods, pushing the U. S. Trade balance toward a deficit.

What does it mean when a currency appreciates?

A currency appreciates when the value of the currency increases. For example if $1 is equivalent to 1000 rubles. If the US dollar appreciates, it can buy more rubles. For example 1200 rubles.

When a currency appreciates, it purchasing power increases. Thus, import would increase and export would reduce. This would lead to a negative trade balance.

To learn more about appreciation, please check: brainly.com/question/26847097