Use the Figure Below to Answer the Following Question(s)

question 95

Multiple Choice

Use the figure below to answer the following question(s) . Figure 18-2
In Figure 18-2, which of the following would cause the American demand for foreign exchange (pounds) to shift from D₁ to D₂?

• A) an increase in the U.S. real interest rate
• B) higher inflation in Britain than in the United States
• C) higher income growth in Britain than in the United States
• D) an increased level of vacation travel to Britain by Americans

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