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

question 45

Multiple Choice

Use the figure below to answer the following question(s) .
Figure 18-2

-Figure 18-2 illustrates supply and demand for U.S.dollars and British pounds in the foreign exchange market.Which of the following would cause the demand for foreign exchange (pounds) to shift from D₁ to D₂?

• A)an increase in the real interest rate in Britain relative to the United States
• B)higher inflation in Britain than in the United States
• C)higher income growth in Britain than in the United States
• D)an increase in the number of British citizens vacationing in the United States

---

Definitions:

Journal Entry

The recording of financial transactions into accounting records, detailing the accounts that are affected and in what way.

Borrow

The act of receiving something of value in exchange for the promise to return it or its equivalent at a later date.

Credit Card Company

A financial institution that issues credit cards, extending credit for consumers to purchase goods and services with the promise of future repayment.

Service Charge

An additional fee charged for services rendered, often seen in the hospitality and banking industries.