The Figure Given Below Depicts the Foreign Exchange Market for British

question 76

Multiple Choice

The figure given below depicts the foreign exchange market for British pounds traded for U.S.dollars. Figure 36.2 Refer to Figure 36.2.Suppose S₁ is the initial supply curve and the British demand for U.S.manufactured computers decreases.Then, with flexible exchange rates:

• A)the price per British pound decreases by $0.10 and the quantity of British pounds increases by 50.
• B)the price per British pound decreases by $0.10 and the quantity of British pounds decreases by 50.
• C)the price per British pound increases by $0.15 and the quantity of British pounds decreases by 50.
• D)the price per British pound increases by $0.15 and the quantity of British pounds decreases by 75.
• E)the price per British pound and the quantity of British pounds remain unchanged.

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Definitions:

Southwestern United States

A region of the United States that includes states like Arizona, New Mexico, Texas, and parts of California and Nevada.

Pueblo Indians

Native American peoples of the Southwestern United States, known for their unique adobe dwellings and cultural traditions.

Bering Strait

A narrow body of water between the easternmost point of the Asian continent (Russia) and the westernmost point of the North American continent (Alaska) that connects the Arctic Ocean with the Pacific Ocean.

Atlantic Ocean

The second-largest ocean on Earth, bordered by the Americas to the west and Europe and Africa to the east, covering approximately 20 percent of the Earth's surface.