Draw a graph with the number of dollars per yen on the vertical axis and the quantity of yen on the horizontal. Click here
Graph the following curves by clicking here
a.
Draw a demand curve for yen and label it D1. Why is it downward sloping?
b.
Draw a supply curve for yen and label it S1. Why is it upward sloping?
i. a poor growing season decreases U.S. agricultural exports to Japan
ii. an increased interest in Shinto prompts a large increase in American tourists traveling to Japan
Draw the new supply and demand curves on the same graph, labeling them D2 and S2.
What happens to the price of yen? Does the dollar appreciate or depreciate? Explain.
