If the U.S.demand for British Pounds Increases,then:​

question 6

Multiple Choice

If the U.S.demand for British pounds increases,then:​

• A)the dollar price of British pounds will increase.
• B)the dollar price of British pounds will decrease.
• C)the exchange rate between dollars and pounds will be less than the equilibrium exchange rate.
• D)the pound will fall in value vis-à-vis the dollar.
• E)there will be no change in either the value of the dollar or the pound.

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Definitions:

Long-Run Adjustments

Adjustments that firms make over a period where all inputs can be varied, and there are no fixed factors of production.

Industry Supply

The total output of a particular good or service that all producers in the market are willing and able to sell at a given price level, over a specific time period.

Short-Run Market Supply

The total quantity of a good or service that producers are willing and able to sell at various prices over a short period, where some production factors are fixed.

Market Price

The price of a commodity when sold in a competitive marketplace, determined by supply and demand.