Answer to Question #108990 in Economics for zero

Question

Explain, with examples, why an appreciating U.S. dollar does not benefit everyone in the American economy.

Answer 1

An appreciation of the U.S. dollar will have good consequences for customers and foreign producers because it will increase Americans' purchasing power and promote a rise in imports. At the same time, an appreciating U.S. dollar can be harmful to domestic manufacturers since many of them won't be able to compete with exterior companies in the American market. As a result, the US government and state authorities won't get local producer taxes.