Question

Suppose Americans working in the textile industry decide to boycott goods made in the European Union. Explain how this boycott will affect each of the following: The supply of dollars The international value of the dollar

Answer 1

Answer: See explanation

Explanation:

The supply of dollars: The boycott by the Americans would result in the reduction in the supply of dollars on the international market. This is due to the fact that there will be less dollar going to the European Union.

The international value of the dollar: There'll be a depreciation in the value of the dollar. A reduction in demand would lead to decline in it's value.