Question

When the U.S. dollar appreciates against other currencies, U.S. goods can be __________ to consumers in foreign countries but can have __________ implications for American companies with branch operations overseas.

Answer 1

Answer:

More expensive and negative

Explanation:

1. Because a customer in orther country must pay more to buy U.S dollar so the same product but now it is different price.

2/ Because it becomes more expensive for those company when thay declare foreign profits in the United States

Answer 2

Answer:

The correct answer is letter "B": more expensive; negative.

Explanation:

A currency appreciates when its value increases in front of the value of other currencies. It is beneficial for countries where the appreciated currency represents the official method of payment but for foreign countries, it is translated as a devaluation of their currency.

Thus, if the U.S. dollar appreciates, U.S. goods will be more expensive everywhere where the U.S. dollar is not the official currency. However, for firms operating in both the U.S. and abroad, this scenario will be negative because when they bring their money back to the U.S. they will have to change the foreign currency to U.S. dollars at a higher exchange rate, meaning entities will have lower U.S. dollars.