Refer to the Diagram Below

question 39

Multiple Choice

Refer to the diagram below. Assume the initial demand for and supply of dollars are shown by D₁ and S₁. The exchange rate will be:

• A) $1 equals 5 British pounds.
• B) $4 equals 1 British pound.
• C) $5 equals 1 British pound.
• D) JQ₃ British pounds per dollar.

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Definitions:

Exports and Imports

The act of selling goods and services to another country (exports) and buying goods and services from another country (imports).

Washing Machines

Household appliances designed to clean laundry by combining water, detergent, and mechanical action to remove dirt from clothes, linens, and other fabrics.

Manufactured

The process of producing goods on a large scale using labor, machines, tools, and chemical or biological processing or formulation.