Answer to Question #153348 in Macroeconomics for a12

Question

1. There is a right shift of demand curve for MYR from D1 to D2. Use a graph to answer the following questions:

S

D1

D2

0.20

0.15

Quantity of MYR

Dollar/MYR

0.10

0.05

a) Briefly explain whether Malaysian Ringgit is appreciated or depreciated relative to the US dollar.

b) Which of the following event will shift the demand curve to the right? Explain why?

i) Interest rate in the US has dropped.

ii) Tax in the US has increased.

iii) Speculator believed that Malaysian Ringgit expected to be lower in the future.

Answer 1

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