Question

Which of the following would cause the supply of pesos to decrease, ceteris paribus? Ford opens automobile assembly plant in Mexico Interest rates increase in the United States Mexican GDP increases Tourism in Mexico decreases due to an outbreak of the flu Interest rates increase in Mexico

Answer 1

Answer:

Ford opens automobile assembly plant in Mexico.

Explanation:

If the United States increase their investment in Mexico by for example setting up a new Ford assemble plant in mexico, the supply of Mexican pesos to the foreign exchange market and the dollar price of the peso will decrease.