If the Dollar Per Pound Exchange Rate Falls from $1

question 24

Multiple Choice

If the dollar per pound exchange rate falls from $1.50 per pound to $1.25 per pound,______.

• A)U.S.imports of British goods will increase
• B)U.S.exports of goods to Great Britain will increase
• C)U.S.exports of services to Great Britain will fall because the price of the pound has increased
• D)British demand for American goods will remain unchanged,but American demand for British goods will fall
• E)U.S.demand for British goods will remain unchanged,but British demand for American goods will increase

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Definitions:

Labor Force

The labor force comprises all individuals above a certain age who are either employed or actively seeking employment, representing the available workforce for an economy.

Discouraged Workers

Discouraged workers are individuals who are not actively seeking employment due to believing that no jobs are available for them or that they would not qualify for those that are.

Disinflation

A slowdown in the rate of inflation, indicating a deceleration in the pace at which prices for goods and services rise.

CPI

The Consumer Price Index is an index that calculates the weighted average price of a basket of consumer goods and services, serving as a gauge for inflation.