The Brexit Vote in June 2016 Resulted in Higher Expected

question 129

Multiple Choice

The Brexit vote in June 2016 resulted in higher expected trade barriers. The relative expected return on British (pound) assets therefore ________ and so the quantity demanded of pound assets ________ at any given exchange rate,shifting the demand curve for pound assets to the ________.

• A)fell;declined;left
• B)fell;increased;right
• C)fell;declined;right
• D)rose;declined;left
• E)rose;increased;left

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Definitions:

Devalue Currencies

The intentional decrease in the value of a country's currency compared to other currencies, typically conducted by the government or central bank to adjust the country's trade balance.

Foreign Investment

Capital investment made by one country into another, either by buying a company in the target country or by expanding operations of an existing business.

Revenue Tariff

A tax imposed on imported goods primarily for generating government revenue rather than protecting domestic industries.

Generate Income

The process of creating revenue or earnings through various sources such as work, investments, or business activities.