Assume That the Inflation Rate Becomes Much Higher in the U.K

Multiple Choice

Assume that the inflation rate becomes much higher in the U.K. relative to the U.S. This will place ____ pressure on the value of the British pound. Also, assume that interest rates in the U.K. begin to rise relative to interest rates in the U.S. The change in interest rates will place ____ pressure on the value of the British pound.

A) upward; downward
B) upward; upward
C) downward; upward
D) downward; downward