Suppose the US government reduces taxes on income allocated towards retirement savings. As households begin to save more for retirement, US net exports increase and the exchange rate rises U S net exports increase and the exchange rate falls US net exports decrease and the exchange rate rises US net exports decrease and the exchange rate falls

Principles of Economics (MindTap Course List)
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Chapter32: A Macroeconomic Theory Of The Open Economy
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Suppose the US government reduces taxes on income allocated towards retirement savings.

 

As households begin to save more for retirement,

 

US net exports increase and the exchange rate rises U

 

S net exports increase and the exchange rate falls

 

US net exports decrease and the exchange rate rises

 

US net exports decrease and the exchange rate falls

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