Answer to Question #251920 in Macroeconomics for kesa

Question

explain what would happen to the rand/dollar exchange rate and the equilibrium quantity of dollars if south african exports to the united states increase

Answer 1

The increase in South Africa export to the united states will lead to an increase in demand for the rand which will cause the rand curve to shift rightward increasing the quantity demanded of the rand. Therefore the appreciation for of rand will lead to an increase in the value of the rand causing a fall in the rand/ dollar exchange rate.