Answer to Question #251961 in Macroeconomics for Mahlodi

Question #251961

News about high level of criminal activity in South Africa discouraged American tourists from visiting South Africa.The decline in the number of tourists from the USA will lead to.

1 A decrease in the demand for dollars.and a subsequent depression of the rand against the dollar
2 An increase in the supply of dollars (leftward shift of the supply curve) causing an appreciation of the rand against the dollar
3 A depreciation of the rand against the dollar and a consequent decrease in the rate of inflation
4 A depreciation of the rand against the dollar and a conquest rise in the rate of inflation

Expert's answer

1 A decrease in the demand for dollars.and a subsequent depression of the rand against the dollar