If the British Price Level Rose Relative to the Swiss

question 141

Multiple Choice

If the British price level rose relative to the Swiss price level,there would be

• A) a rightward movement along the supply of Swiss francs curve in the pound-franc market
• B) a leftward movement along the supply of Swiss francs curve in the pound-franc market
• C) an increased supply of Swiss francs to the pound-franc market
• D) a decreased supply of Swiss francs to the pound-franc market
• E) no change of the supply of Swiss francs curve in the pound-franc market

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Definitions:

Deflation

Deflation is an economic condition characterized by a general decrease in prices of goods and services, often indicating a reduction in the supply of money or credit.

International Exchange Rate System

The framework through which countries manage the value and exchange of their currencies in relation to one another.

Gold Standard

A currency system that directly correlates the value of a nation's paper money or currency with the value of gold.

Gold Standard

A financial system in which the value of a nation's currency or banknotes is directly tied to gold.