The amount of goods and services you can buy with a dollar in the global market: A. is not affected by the value of a dollar B. increases during a period of inflation C. increases with a falling dollar value D. increases with a rising dollar value.
Question & Answer
Purchasing power of a dollar
1 Answer
Verified archiveThe correct answer is D. increases with a rising dollar value.
When the value of the dollar increases (appreciates), it has more purchasing power in relation to foreign currencies, allowing consumers to buy more goods and services in the global market. Conversely, when the dollar’s value falls (depreciates), it can buy less. Therefore, a rising dollar value increases the amount of goods and services you can buy with a dollar globally. If you have more questions, feel free to ask!