When the British Pound Rises in Value Relative to Other

question 48

Multiple Choice

When the British pound rises in value relative to other currencies,then

• A)goods imported into Britain rise in price.
• B)British exports rise in price.
• C)neither British exports nor imports rise in price.
• D)both British exports and imports rise in price.

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Definitions:

Market Price

The amount of money for which a good or service is offered, sold, or bought in the market.

Cost

The value of the inputs used in the production of goods or services, including money, time, and resources.

Producer Surplus

Producer surplus is the difference between what producers are willing to accept for a good or service versus what they actually receive, often seen as profit.

Producer Surplus

The disparity between the price suppliers are ready to settle for when selling a good or service and the greater amount they end up receiving.