On March 30, 2012, the U.S. dollar was trading at 82 yen per U.S. dollar on the foreign exchange market. On August 30, 2012, the U.S. dollar was trading at 79 yen per U.S. dollar.
a. What events in the foreign exchange market could have brought this fall in the value of the U.S. dollar?
b. Did the events you’ve described change the demand for U.S. dollars, the supply of U.S. dollars, or both demand and supply in the foreign exchange market?