Multiple Choice
If the U.S.interest rate falls at the same time there is an increase in British real GDP,which of the following would happen in the market for British pounds?
A) A rightward shift of the demand for pounds curve,a rightward shift of the supply of pounds curve,a larger number of pounds traded,and an indeterminate effect on the dollars per pound exchange rate.
B) A rightward shift of the demand for pounds curve,a rightward shift of the supply of pounds curve,a larger number of pounds traded,and an increase in the dollars per pound exchange rate.
C) A rightward shift of the demand for pounds curve,a rightward shift of the supply of pounds curve,a larger number of pounds traded,and a decrease in the dollars per pound exchange rate.
D) A leftward shift of the demand for pounds curve,a rightward shift of the supply of pounds curve,a larger number of pounds traded,and an indeterminate effect on the dollars per pound exchange rate.
E) Cannot be determined without additional information.
Correct Answer:

Verified
Correct Answer:
Verified
Q8: In the dollar-pound market,whenever there is an
Q9: During the 1997-1998 Asian financial crisis,Thailand tried
Q10: In the long run,the currency of a
Q11: A floating exchange rate is one that
Q12: If Americans expect the dollar price of
Q14: To maintain a fixed exchange rate,a central
Q15: You see on the news that a
Q16: If U.S.imports total $100 billion and exports
Q17: Under a managed float,<br>A) currency traders "buy
Q18: One reason why purchasing power parity may